Markets cautious ahead of Fed meeting

Stocks closed lower yesterday after investors held back ahead of three critical events this week: policy meetings at both the Federal Reserve and the European Central Bank and a closely watched report on jobs in the United States.

The Dow Jones industrial average lost 64.33 points to close at 13,008.68. The Standard & Poor's 500 edged down 0.43 percent to 1,379.32. The Nasdaq composite lost 0.21 percent to 2,939.52.

The Federal Reserve started its two-day policy meeting and appeared to be moving toward announcing some kind of new steps to energize the U.S. economy. But there were questions over whether it will do so this week.

Nearly three stocks fell for every two that rose on the New York Stock Exchange. Volume was average at 3.7 billion shares.

Investors are cautious over whether the Fed will act again to kick-start the economy, and when it will do so.

The U.S. Commerce Department reported Tuesday that spending by the U.S. consumer was unchanged in June, though personal income edged up 0.5 percent.

That would suggest there will be more pressure on the Fed to act, because it appears that Americans are putting their paychecks in their pockets rather than spending them.-- AP