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also declined: Altria Group slipped 1.59 dollars, or 3.7%, to 41.76 dollars, while Philip Morris International fell 1.36 dollars, or 1.6%, to 84.59 dollars.
The Standard Poor's 500 index fell 3.82 points, or 0.2%, to 1,973.28. The index is down 0.6% from its most recent all time high of 1,985.44 set on July 3.
Fed Chair Janet Yellen, speaking before Congress, said the US economy has yet to recover fully, but raised the possibility the central bank could raise its Saucony Excursion Tr8 key short term interest rate sooner than currently projected.
Bond prices barely budged. The yield on the 10 year Treasury note held steady at 2.55%.
Bank earnings on Tuesday set a good tone for the latest earnings season.
Stocks mostly down after Fed report Express Star
"In this type of environment when you have a lot of uncertainty, essentially you have this equilibrium that's looking to be broken one way or another, and the Fed chair saying 'financial bubble' could do that," Mr Wilson said.
By suggesting some stocks could be overvalued, the Fed is adding to a growing belief among some market watchers that stocks are due for a pullback, said Drew Wilson, an equity analyst at Fenimore Asset Management.
Stocks finished the day mixed, with the Dow Jones industrial average eking out a tiny gain on the day.
Shares in rent to own retailer Aaron's tumbled 9.5% after the company cut its profit and revenue outlook for the second quarter, partly citing performance of its core business. The stock shed 3.19 dollars to 30.34 dollars.
Employers added 288,000 jobs last month, the fifth straight month of gains above 200,000. The national unemployment rate has slid to 6.1%, a five and a half year low.
Ms Yellen noted that if labour market conditions continue to improve more quickly than anticipated, the Fed could raise its key short term interest rate sooner than currently projected.
0.03%, to 17,060.68. The index is down slightly from its July 3 record of 17,068.65.
The major US financial market indexes were up slightly in premarket trading as JPMorgan, Goldman Sachs and Johnson Johnson released quarterly results that exceeded Wall Street's expectations.
JPMorgan, the nation's largest bank by assets, said its second quarter earnings Reebok Memory Tech
Luxury goods retailer Michael Kors fell 6.23 dollars, or 7.3%, to 79.44 dollars as some financial analysts cut their price target on the stock. Slowing sales growth even as the retailer cuts prices has worried some analysts.
Cigarette maker Reynolds American said it plans to buy rival Lorillard for about 25 billion dollars in a deal to combine two of the nation's oldest and biggest tobacco companies. Reynolds fell 4.34 dollars, or 6.9%, to 58.84 dollars, while Lorillard sank 7.05 dollars, or 10.5%, to 60.17 dollars. Other tobacco stocks Saucony High Top
"In light of corporate earnings being good, retail sales being good, manufacturing being good, even a data driven Fed chairman is going to have to raise rates earlier than the market really wants," said Doug Cote, chief market strategist at Voya Investment Management. "So all the good fundamental data that should be good for the markets is also hawkish for rates."
Investors hammered companies whose quarterly results were less positive.
fell 9% as revenue at its investment banking and mortgage businesses dropped. The stock gained 1.98 dollars, or 3.5 %, to 58.27 dollars. Goldman's profit rose 5%, helped by record results from investment banking. Goldman gained 2.17 dollars, or 1.3% , to 169.17 dollars.
Investors had plenty more to consider on Tuesday, including a mostly encouraging batch of corporate earnings and economic data.
Separate reports on US retail sales and manufacturing growth also gave the market an early lift.
The three stock indexes are all up for the year.
Beyond the Fed, investors are mostly focused on company earnings this week, including quarterly reports from Bank of America, eBay and Yum Brands on Wednesday.
The Nasdaq composite shed 24.03 points, or 0.5%, to 4,416.39.
Among other stocks in the news Tuesday:
The Fed also issued a report noting that valuations for stocks in some sectors, such as social media and biotech firms, appear to be stretched, sending shares in Facebook, Twitter and LinkedIn lower.
But stock indexes diverged shortly after the market opened and then fully veered into the red about an hour into regular trading as investors began to tune into Ms Yellen delivering the central bank's semi annual economic report to Congress.
Ms Yellen told Congress that the Fed intends to keep providing significant support to the US economy to boost growth and improve labour market conditions, noting that the economic recovery is not yet complete.
The Dow added 5.26 points, or Reebok Casual Shoes For Womens
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