NEW YORK (CNNfn) - U.S. stocks continued to drift lower at midday Tuesday with investors opting for safety ahead of the afternoon's eagerly awaited interest-rate decision by the Federal Reserve.
Shortly before 11:30 a.m. ET the Dow Jones industrial average was 53.55 points lower at 8,957.70. On the New York Stock Exchange, declining stocks outnumbered gainers 1,762 to 882 as trading volume reached 203 million shares.
The Nasdaq Composite fell 15.20 to 1,846.48 and the S&P 500 index shed 3.99 to 1,131.87. (Click here for a look at today's CNNfn market movers)
The Federal Open Market Committee, the Fed's monetary policy arm, began a one-day meeting that many market experts expect will result in an interest-rate reduction aimed at staving off an economic recession next year.
The bond market edged higher as investors seemed to bet on an imminent interest-rate cut. The benchmark 30-year Treasury bond rose 10/32 of a point in price, for a yield of 5.26 percent.
The dollar was mixed, stuck in a narrow trading band as investors opted to remain on hold ahead of the Fed's interest-rate decision, expected to be announced around 2:15 p.m. ET.
Eye on technology
In stocks, financial and technology issues once again dominated trading.
Among the big-name tech stocks, Dow component Hewlett-Packard (HWP) tumbled 5-15/16 to 60-3/16 as investors appeared disappointed with the company's growth prospects even after HP reported better-than-expected earnings late Monday.
IBM (IBM), another Dow 30 technology leader, eased 1/2 to 158-7/8. On the Nasdaq, Dell (DELL) fell 1-1/2 to 61-11/16, Intel (INTC) dropped 1-1/8 to 105-3/4 and Microsoft (MSFT) inched up 11/16 to 109-1/2.
Meanwhile, financial stocks, which rallied sharply Monday on expectations for lower rates, seemed to cool off somewhat Tuesday. Among the Dow components, American Express (AXP) edged up 1/16 to 97, Citigroup (CCI) rose 1/16 to 44-3/16 and J.P. Morgan (JPM) lost 1/16 to 103-7/16.
Outside the Dow, BankAmerica (BAC) eased 3/16 to 59-9/16 and Chase Manhattan (CMB) lost 9/16 to 57-5/16.
In the day's newsmakers, shares of newly merged transatlantic auto giant DaimlerChrysler (DCX) made their Big Board debut, easing 1-9/16 from Monday's when-issued price to 82-3/4.
And the stock of Envoy (ENVY), an electronic data-processing service provider, surged 5-13/16, or nearly 18 percent, to 38-1/4 on news the company had resolved an accounting problem raised by the Securities and Exchange Commission. 
-- by staff writer Malina Poshtova Zang
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