MARKET SNAPSHOT: U.S. Stocks Retreat From Records Ahead Of Yellen Testimony Part Deux

By Anora Mahmudova and Barbara Kollmeyer, MarketWatch

Hewlett-Packard skids 9% after earnings miss

NEW YORK (MarketWatch) -- U.S. stocks drifted lower Tuesday. retreating from record levels achieved during the previous session, as investors were cautious ahead of another day of testimony by Federal Reserve Chairwoman Janet Yellen.

Downbeat results from Hewlett-Packard Inc. weighed on technology stocks.

The S&P 500 (SPX) drifted lower and The Dow Jones Industrial Average (DJI) fell slightly, with more than two-thirds of the blue-chip index trading lower. Intel Corp was leading losses. The Nasdaq Composite (RIXF) also fell, weighed down by losses in tech stocks.

Hewlett-Packard (HPQ) was weighing down the tech index, with shares off nearly 9%. The company said first-quarter revenue (http://www.marketwatch.com/story/comcast-h-p-macys-first-solar-earnings-in-focus-2015-02-24) fell short of Wall Street's expectations and it also cut its 2015 outlook to adjust for a stronger dollar.

Read more: What's changed since the last time the Nasdaq was at 5,000? (http://www.marketwatch.com/story/six-differences-between-now-and-last-time-nasdaq-was-at-5000-2015-02-24)

Stocks got a modest lift Tuesday after Federal Reserve Chairwoman Janet Yellen's testimony to the Senate reassured watchers that a rate hike might not occur until the second half of the year.

Read more: Yellen prepares markets for a less-patient Fed (http://www.marketwatch.com/story/yellen-prepares-markets-for-less-patient-fed-2015-02-24)

(http://www.marketwatch.com/story/yellen-prepares-markets-for-less-patient-fed-2015-02-24)"Answering a question about inflation, she concluded that she cannot see any evidence that inflation will rise anytime soon. So the June rate hike is off the table, especially if tomorrow's CPI slows any further," said Nour Al-Hammoury, chief market strategist at ADS Securities in Abu Dhabi, in an investor note.

"The more the U.S. figures disappoint, the more the U.S. equities will keep on rising," Al-Hammoury said.

"So far the S&P 500's action has lock-stepped with the comments in these [Yellen's] missives in that the market's internal energy is being released on the upside. Surprisingly, given the two-week rally, there is still plenty of internal energy available to push prices higher," said Jeffrey Saut, chief investment strategist at Raymond James in a note to investors.

Retailers in focus:Chesapeake Energy Corp.(CHK) shares slid 11% after a profit miss, making the it the biggest decliner on the S&P 500.

Late Monday, First Solar Inc.(FSLR) reported that its profit nearly tripled in the fourth quarter. Shares, which climbed 10% on Monday on a deal news, were up more than 4%.

Dollar Tree(DLTR) and Salesforce.com Inc.(CRM) are also due to report.

(CRM)Read more: Target, Dollar Tree, Salesforce.com earnings in focus (http://www.marketwatch.com/story/target-dollar-tree-salesforcecom-earnings-in-focus-2015-02-25)

(http://www.marketwatch.com/story/target-dollar-tree-salesforcecom-earnings-in-focus-2015-02-25)Shares of Southwest Airlines Co.(LUV) fell slightly after the company said it pulled 125 jets out of service Tuesday (http://www.marketwatch.com/story/southwest-pulls-more-than-125-jets-out-of-service-over-missed-inspections-2015-02-25) --roughly one-fifth of its fleet -- over missed inspections.

Consumer Reports (http://www.marketwatch.com/story/the-just-in-the-press-adores-tesla-2015-02-24) named Tesla Motors Inc'.s(TSLA) Model S the top pick in 2015 for car buyers. Shares rose 1%.

Also read: Apple shares may be ripe for a correction (http://www.marketwatch.com/story/apple-ripe-for-a-correction-2015-02-24)

(http://www.marketwatch.com/story/apple-ripe-for-a-correction-2015-02-24)Other markets: The view of a dovish Federal Reserve helped push gold prices (http://www.marketwatch.com/story/gold-retakes-1200-on-tailwinds-from-yellen-and-china-data-2015-02-25)(GCH5) past $1,200 an ounce. The dollar (http://www.marketwatch.com/story/dollar-pulls-back-versus-yen-after-yellen-testimony-2015-02-25)(DXY) moved lower across major crosses, while WTI oil prices (http://www.marketwatch.com/story/oil-futures-keep-a-wary-eye-out-for-us-inventory-data-2015-02-25)(CLJ5) were little changed ahead of U.S. inventory data due later.

European stocks also pulled back, taking a breather from their own record run on Tuesday. The Stoxx Europe 600 saw its highest close since October 2007. Hong Kong shares got a small lift (http://www.marketwatch.com/storyno-meta-for-guid) after an initial reading of China's manufacturing activity surprised to the upside.

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