US STOCKS-Wall Street retreats after rally; Fed meeting in focus

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* Macy's gains as reopened stores perform better than
expected
* Fed's two-day policy meeting begins
* Broad pullback led by cyclical stocks
* Indexes down: Dow 1.32%, S&P 1.04%, Nasdaq 0.33%

(Updates to open)
By Medha Singh and Devik Jain
June 9 (Reuters) - U.S. stocks fell on Tuesday as investors
paused ahead of a Federal Reserve meeting that could offer views
on the recent signs of economic recovery that drove the
tech-heavy Nasdaq to an all-time high in the previous session.
The S&P 1500 airlines index .SPCOMAIR declined 8.5%, while
cruise operators Carnival Corp CCL.N and Norwegian Cruise Line
Holdings Ltd NCLH.N fell between 10% and 12% after climbing on
Monday.
The Nasdaq .IXIC became the first of Wall Street's main
indexes to confirm it entered a bull market two-and-a-half
months earlier, as a rally in U.S. stocks accelerated last week
after strikingly upbeat May jobs data strengthened views the
worst of the economic fallout from the pandemic was over.
The benchmark S&P 500 .SPX is about 5% below its own
all-time high, having climbed nearly 46% since its pandemic low
on March 23.
"Because the S&P 500 has risen so far, so fast, you can
always anticipate periodic short bouts of profit-taking to occur
along the way," said Randy Frederick, vice president of trading
and derivatives for Charles Schwab in Austin, Texas.
"Markets may be moving based on where the economy will be a
year from now versus, say, six months from now."
While no major policy announcements are expected when the
U.S. central bank wraps up its two-day meeting on Wednesday,
investors will look for hints that the U.S. central bank
believes the worst part of the coronavirus crisis has passed.
The benchmark U.S. yield curve US2US10=TWEB — an indicator
of economic expansion — has widened to its steepest level since
March as U.S. data improved. Investors will also keep an eye out
whether the Fed will step in to flatten the yield curve.
At 9:52 a.m. ET, the Dow Jones Industrial Average .DJI was
down 362.63 points, or 1.32%, at 27,209.81, the S&P 500 .SPX
was down 33.47 points, or 1.04%, at 3,198.92. The Nasdaq
Composite .IXIC was down 32.98 points, or 0.33%, at 9,891.77.
All 11 S&P sectors were in the red with financials .SPSY
weighing the most.
In a bright spot, Macy's Inc M.N jumped 4% after the
department store chain said its 450 reopened stores were
performing better than expected. Tiffany & Co TIF.N edged 2.3% higher as the luxury jeweler
said it had amended certain of its debt agreements in order to
have sufficient liquidity to navigate the virus outbreak as it
posted a 43% slump in quarterly sales. Declining issues outnumbered advancers for a 5.30-to-1 ratio
on the NYSE and a 2.87-to-1 ratio on the Nasdaq.
The S&P index recorded three new 52-week highs and no new
low, while the Nasdaq recorded 21 new highs and no new low.