NEW YORK, New York - U.S. stocks fell Tuesday after the markets' recent heady gains, as profit-takers moved in. Uppermost in investors minds is the monthly meeting of the FOMC committee of the Federal Reserve on Wednesday which will deliver its verdict on the direction of interest rates. Expectations narrowly support a cut.

"The market has had a strong run and is now in digestion mode. Some technical indicators suggest a pullback may be coming," Jay Woods, chief global strategist at Freedom Capital Markets told CNBC Tuesday. "This is a pause, a period to focus on individual names driven by earnings, while the broader market watches how the Fed's narrative evolves."

"Hopefully, we'll get some clarity after Wednesday's press conference," he added.

All three major U.S. benchmarks finished in negative territory Tuesday:

• S&P 500 (^GSPC): Fell 18.91 points (0.30 percent) to close at 6,370.86

• Dow Jones Industrial Average (^DJI): Dropped 204.57 points (0.46 percent) to 44,632.99

• NASDAQ Composite (^IXIC): Declined 80.29 points (0.38 percent) to 21,098.29

Trading volumes were robust, with the NASDAQ seeing 9.017 billion shares change hands, while the Dow traded 487.197 million shares.

U.S. Dollar Mixed in Foreign Exchange Markets as Yen Strengthens, Pound Rises Despite Weak UK Data

The U.S. dollar showed a mixed performance in Tuesday's foreign exchange trading, softening against the Japanese yen but holding firm against the euro and commodity-linked currencies.

Key Currency Movements

• EUR/USD (Euro - U.S. Dollar): The euro fell 0.26 percent to 1.1556, marking its third decline in four sessions amid concerns over sluggish Eurozone growth.

• USD/JPY (U.S. Dollar - Japanese Yen): The dollar slipped 0.10 percent to 148.34 yen, pressured by intervention warnings from Japanese officials.

• GBP/USD (British Pound - U.S. Dollar): Sterling edged up 0.08 percent to 1.3362 despite weaker-than-expected UK retail sales, which fell 1.2 percent month-over-month versus forecasts of a 0.5 percent drop. Analysts attributed the resilience to broad dollar weakness.

• USD/CAD (U.S. Dollar - Canadian Dollar): The greenback rose 0.19 percent to 1.3764 as falling crude oil prices weighed on the commodity-sensitive loonie.

• USD/CHF (U.S. Dollar - Swiss Franc): The dollar gained 0.23 percent to 0.8050, supported by safe-haven demand amid geopolitical tensions.

Commodity Currencies Struggle

• AUD/USD (Australian Dollar - U.S. Dollar): The Aussie dipped 0.06 percent to 0.6516 after disappointing Chinese industrial profit data clouded the outlook for Australia's exports.

• NZD/USD (New Zealand Dollar - U.S. Dollar): The kiwi fell 0.15 percent to 0.5959, underperforming most G10 peers amid risk-off sentiment.

Market Drivers

Traders remained cautious ahead of Wednesday's Federal Reserve policy decision, with markets pricing in a 60 percent chance of a September rate cut. The dollar index (DXY) held steady near 106.80.

Global Stock Markets Close Mixed on Tuesday; UK, Canada and Europe Outperforms, Asia Diverges

Global stock markets delivered a mixed performance on Tuesday, with UK and European indices leading gains while some Asian and Middle Eastern markets faced declines.

Canada's TSX Bucks the North America Trend

In contrast to its U.S. counterparts, Canada's S&P/TSX Composite (^GSPTSE) gained 134.46 points (0.49 percent) to finish at 27,539.88, supported by strength in the energy and financial sectors. Trading volume reached 201.089 million shares.

UK and Europe Rallies Broadly

• UK's FTSE 100 (^FTSE) rose 54.88 points (0.60 percent) to 9,136.32

• Germany's DAX (^GDAXI) surged 247.01 points (1.03 percent) to 24,217.37

• France's CAC 40 (^FCHI) gained 56.48 points (0.72 percent) to 7,857.36

• EURO STOXX 50 (^STOXX50E) climbed 41.64 points (0.78 percent) to 5,379.22

• Belgium's BEL 20 (^BFX) added 26.84 points (0.58 percent) to 4,620.96

Asia and Pacific: Gains 

• Australia's S&P/ASX 200 (^AXJO) edged up 6.90 points (0.08 percent) to 8,704.60

• All Ordinaries (^AORD) inched up 3.20 points (0.04 percent) to 8,966.70

• Shanghai Composite (000001.SS) rose 11.77 points (0.33 percent) to 3,609.71, supported by selective buying in financial and tech stocks.

• India's Sensex (^BSESN) rose 446.93 points (0.55 percent) to 81,337.95

• Indonesia's IDX Composite (^JKSE) gained 3.14 points (0.04 percent) to 7,617.91

• New Zealand's NZX 50 (^NZ50) added 25.67 points (0.20 percent) to 12,936.41

• South Korea's KOSPI (^KS11) rose 21.05 points (0.66 percent) to 3,230.57

Decliners in Asia:

• Hong Kong's Hang Seng (^HSI) fell 37.68 points (0.15 percent) to 25,524.45

• Singapore's STI (^STI) dropped 11.73 points (0.28 percent) to 4,229.41

• Malaysia's KLSE (^KLSE) lost 5.56 points (0.36 percent) to 1,523.82

• Taiwan's TWSE (^TWII) slumped 211.46 points (0.90 percent) to 23,201.52

• Japan's Nikkei 225 (^N225) declined 323.72 points (0.79 percent) to 40,674.55

Middle East and Africa: Mixed Signals

• Israel's TA-125 (^TA125.TA) was nearly flat, up just 0.20 points (0.01 percent) at 3,105.01

• South Africa's Top 40 (^JN0U.JO) gained 5.89 points (0.11 percent) to 5,487.61

• Egypt's EGX 30 (^CASE30) edged up 9.50 points (0.03 percent) to 34,085.70

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