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Wall St. struggles: Stocks cut early gains, turn mixed

Wall St. struggles: Stocks cut early gains, turn mixed

Stocks gave up early gains and were trading mixed at midday in choppy trading Tuesday as Wall Street struggles to rebound from Monday’s sharp sell-off that edged the broad U.S. market ever closer to its 2015 lows hit in late August. After initially struggling to gain traction, stocks jumped higher after a report showed consumers grew more confident in September despite increased market volatility. The Conference Board’s consumer confidence index rose to 103.0 from 101.3 in August. Economists expected a drop to 97.

But investors were unable to hold onto those gains as stocks pulled back in late morning trading. The Dow Jones industrial average was down about 10 points, or 0.1%, after having risen as much as 118 points earlier in the session. The Standard & Poor’s 500 index was up 0.2% after tumbling 2.6% Monday to 1881.77 — putting the broad U.S. stock gauge perilously close to its low for the year of 1867.61 back on Aug. 25, a scary low that followed a 1,000-point drop in the Dow Jones industrial average a day earlier on Aug. 24.

The Nasdaq composite index up 0.1%, after sliding more than 3% to start the trading week Monday. The volatile trading was worrisome as the so-called “retest” of the S&P 500′s August lows is what Wall Street was focused on. The market’s failure to hold those levels means the S&P 500, which kicked off Tuesday’s trading session down 11.7% from its May 21 record close and off 8.6% for the year, could have farther to fall. The closely watched stock index is on track for its worst quarter since the third quarter of 2011.

How the market reacts when stocks get down to the August lows is critical, Wall Street pros say. The storyline is simple: If the market holds at those levels, a floor could develop under the market. If the old lows don’t hold, prices will go even lower in search of lower support levels.

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