The S&P 500 dipped on Tuesday as traders assessed the Federal Reserve's next move and whether the U.S. is headed eventually into a recession.
The Dow Jones Industrials eased back 29.17 points by noon to 34,892.71, boosted by gains in Merck and Chevron.
The S&P 500 slumped 23.71 points to 4,558.93.
The NASDAQ Composite cratered 239.36 points, or 1.6%, to 14,291.96.
Deutsche Bank on Tuesday became the first major Wall Street bank to forecast a U.S. recession is ahead, citing surging inflation and aggressive Federal Reserve rate hikes.
Stocks could be on hold as investors await the release of Federal Reserve meeting minutes on Wednesday. Those minutes were for the meeting last month where the central bank hiked rates for the first time in years and indicated six more hikes were ahead this year.
Shares that would hold up well in a slowing economy were higher on Tuesday. Drugmakers Johnson & Johnson and Pfizer were higher by more than 1.5%. Staples like Procter & Gamble and Walmart were also higher.
Meanwhile, cruise stocks like Carnival, Norwegian Cruise Line, and Royal Caribbean rose more than 3%.
Tech shares were lower, led by chip shares, consolidating their big gains from Monday. Some believe this group could be hurt the most by the Fed's hiking campaign as investors take less risk and buy stocks with steady profits, rather than growth shares promising big earnings down the road.
Nvidia lost 3% while Amazon and Tesla were each lower. Still, Twitter shares added another 3% to their 27% Monday gain after Elon Musk said he will join the company's board of directors a day after revealing a 9.2% stake in the social media giant.
And investors continue to keep an eye on Europe, as the war between Ukraine and Russia continues. Ukraine President Volodymyr Zelenskyy pledged to pursue allegations of war crimes against Russian forces, noting that more than 300 people were killed and tortured in a suburb near the capital of Kyiv
Treasury prices faltered as yields spiked to 2.55%, from Monday's 2.41%. Treasury prices and yields move in opposite directions.
Oil prices backtracked 38 cents to $102.90 U.S. a barrel.
Gold prices moved backward four dollars to $1,930.00 U.S. an ounce.