Stocks close mostly lower ahead of fed

U.S. stocks closed mostly lower Tuesday as a decline in health care stocks weighed and investors awaited the Wednesday afternoon conclusion of the Federal Reserve meeting. (TWEET THIS) As of

the close, trade volume across the exchanges was on pace for the second lowest trade volume day of the year so far. "They're not willing sellers and they're not overly

willing buyers," said Robert Pavlik, chief market strategist at Boston Private Wealth. "I think the underlying note of the day would be not wanting to be caught on the wrong side

of the Fed," he said. The Federal Open Market Committee kicked off its two-day meeting Tuesday and is scheduled to release its statement and economic projections Wednesday afternoon.

Fed Chair Janet Yellen is also due to hold a press conference. Oil trims losses after smaller-than-expected rise in crude stocks US Treasurys waver ahead of Fed meeting Dollar falls against

yen after US data, BOJ decision The major averages came well off session lows in afternoon trade, with the Dow Jones industrial average recovering from a 108-point dip to close up about 22

points as Apple climbed. The Nasdaq composite and S&P 500 closed slightly lower, with health care off 1.6 percent to lead S&P 500 decliners. The iShares Nasdaq Biotechnology ETF

(IBB) ended 3.8 percent lower, its worst day since Jan. 13. Apple closed about 2 percent higher after Morgan Stanley said it sees above-consensus iPhone demand of about 56.5 million units,

with the strongest growth from China. Morgan Stanley is "overweight" the stock with a $135 price target. Brian Blair, principal at Grays Peak Capital, said Apple's gains today

are "100 percent" related to Morgan Stanley's note, especially since shares of key suppliers are trading higher. "I do think it's a fair assessment," he said.

"The Street has a pretty low bar for Apple units." The iPhone maker is also expected on Tuesday to submit its latest response to the U.S. Justice Department in its high profile

encryption case. Shares of Valeant Pharmaceuticals plunged 51 percent for its worst daily performance ever after the firm gave earnings and revenue guidance far below expectations. "I

would say Valeant's certainly the biggest negative. Today's trade is the death of price increases," said Mike Bailey, director of research at FBB Capital Partners. However, he

said he would "not follow that line of thinking. If you have got a good product and not a lot of competition, you can take the price up." U.S. stocks opened lower as a decline in

commodity prices weighed. U.S. crude oil futures settled down 84 cents, or 2.26 percent, at $36.34 a barrel, its lowest settle since March 4 and its first two-day decline since mid-February.

Copper also traded lower. "Two bad days in a row for the commodities got people nervous again, clipping some gains," said Jeremy Klein, chief market strategist at FBN Securities.

"People are wanting to see if (the Fed policymakers) have an intent to hike again in June," he said. Read MoreFed could trump data dump As of the close Tuesday, futures were

pricing in a 0 percent probability of a rate hike in March, and a 48 percent chance in June, according to CME's FedWatch tool. "Investors will probably not choose to be overly

aggressive (Tuesday) and basically sit on the sidelines until we get the results of the FOMC meeting," said Peter Cardillo, chief market economist at First Standard Financial. In

economic news, retail sales fell a less-than-expected 0.1 percent in February, but January's figure was revised down to show a 0.4 percent decline versus the previously reported 0.2

percent increase. Following the data release, Barclays cut its U.S. GDP forecast to 1.9 percent from 2.4 percent. As of Tuesday, CNBC's Rapid Update also showed a median estimate of 1.9

percent growth for the first quarter, while the Atlanta Fed's GDPNow model was revised down to 1.9 percent from 2.2 percent last week. U.S. producer prices fell 0.2 percent in

February, but were unchanged over the last 12 months. That marked the first time since January 2015 that the year-on-year PPI did not decline, Reuters said. In other economic reports, the

NAHB Housing Market Index held steady at 58 in March. Business inventories rose 0.1 percent in January. Treasury yields turned higher, with the higher near 0.97 percent and the 10-year yield

flat near 1.97 percent. The 2-year yield briefly hit 0.972 percent, its highest since Jan. 8. The U.S. dollar index was a touch higher, with the euro near $1.1107 and the yen at 113.11 yen

against the greenback. Overnight, the Bank of Japan kept rates unchanged, as expected, but gave a gloomier view on the economy and exports in particular than it did in January. European

stocks ended loser, with the pan-European Stoxx 600 index falling 1.1 percent. Asian stocks closed mostly lower, except for the Shanghai composite which eked out a gain of nearly 0.2

percent. Read More Early movers: VRX, AAPL, TIF, VZ, AIG, GE, TM, AMZN & more The DOW JONES INDUSTRIAL AVERAGE closed up 22.40 points, or 0.13 percent, at 17,251.53, with Apple leading

advancers and Pfizer the greatest decliner. The closed down 3.71 points, or 0.18 percent, at 2,015.93, with health care leading six sectors lower and information technology the top gainer.

The NASDAQ composite closed down 21.61 points, or 0.45 percent, at 4,728.67. The CBOE VOLATILITY INDEX (VIX), widely considered the best gauge of fear in the market, traded above 17. About

three stocks declined for every advancer on the New York Stock Exchange, with an exchange volume of 827 million and a composite volume of 3.5 billion in the close. Gold futures for April

delivery settled down $14.10 at $1,231.00 an ounce. —_CNBC's Peter Schacknow and Reuters contributed to this report._ _ON TAP THIS WEEK:_ TUESDAY FOMC meeting begins 4 p.m.: Treasury

international capital WEDNESDAY Earnings: Cheetah Mobile, RedEx, Ctrip.com Intl., Guess, Herman Miller, Jabil Circuit 7 a.m.: Mortgage applications 8:30 a.m.: CPI 8:30 a.m.: Housing starts

9:15 a.m.: Industrial production 10:30 a.m.: Oil inventories 1 p.m.: European Central Bank President Mario Draghi gives welcoming remarks at ECB Contemporary Art From Poland Exhibition 2

p.m.: FOMC meeting announcement 2:30 p.m.: Fed Chair Janet Yellen press conference THURSDAY Bank of England monetary policy announcement and minutes Earnings: Tencent, Michaels Cos., Intl.

Game Technology, Lands' End 8:30 a.m.: Jobless claims 8:30 a.m.: Philly Fed business outlook survey 8:30 a.m.: Current account 10 a.m.: JOLTS 10 a.m.: Leading indicators 10:30 a.m.:

Natural gas inventories 4:30 p.m.: Fed balance sheet/Money supply FRIDAY Quadruple Witching Earnings: Tiffany 9 a.m.: New York Fed President William Dudley speaks 10 a.m.: Consumer sentiment

10 a.m.: Atlanta Fed business inflation expectations 11 a.m.: Boston Fed President Eric Rosengren speaks 1 p.m.: Oil rig count 1:30 p.m.: St. Louis Fed President James Bullard *Planner

subject to change. _MORE FROM CNBC.COM:_ * Main St. speaks out: Our top pick for president * Pro Uncut: Full interview with Jeff Ubben * How one man turned a prison into a profitable gym