New Home Sales Drag Stocks Back in the Red Ahead of the Fed

Economic uneasiness continues to weigh on the markets and stocks are modestly lower on the heels of last week's solid decline and yesterday's disappointing late-day slide, which wiped away gains as an unexpected drop in new home sales is exacerbating sentiment. Traders are also treading cautiously ahead of the afternoon release of the Federal Reserve's interest rate announcement and monetary policy statement. The earnings front is providing some news for traders to chew on as they wait for the Fed's announcement, with Dow members Boeing and United Technologies both topping the Street's estimates, while fellow Dow component Caterpillar missed on the top line and provided cautious guidance, which are overshadowing its better-than-expected bottomline. Outside of the Dow, Yahoo posted profits that exceeded analysts' forecasts. Treasuries have moved higher in late-morning action ahead the Fed's report and after the disappointing new home sales report, which is teaming up with a drop in mortgage applications to add to the economic uneasiness and the unfavorable backdrop for the housing sector. Overseas, markets are under pressure amid lingering concerns about China's efforts to control asset bubbles.