US stocks declined after Fed talk and budget discussions

U.S. stocks ended mostly lower, with blue chips suffering a fourth-straight loss, as a late slide in the financial sector and uncertainties over budget discussions weighed on sentiment.

The Standard & Poor’s 500 Index fell 0.3% to 1,697.42 at 4 p.m. in New York. The Dow Jones Industrial Average lost 66.79 points, or 0.4%, to 15,334.59. About 6 billion shares changed hands on U.S. exchanges, in line with the three-month average.

The market is “riding waves of news, both good and bad,” Malcolm Polley, the chief investment officer at Stewart Capital Advisors LLC in Indiana, Pennsylvania, said in a telephone interview for Bloomberg. His firm manages $1.1 billion. “The market is very dependent on macro news.”

The equity benchmark index erased earlier losses as President Barack Obama noted that Iran may offer a basis for a “meaningful agreement” to resolve the confrontation over the Persian Gulf nation’s nuclear program, one of the primary sources of instability in the Middle East. Iranian officials told the U.S. that the time isnt right for direct contact between the two countries’ leaders.

Stocks turned lower in the last 30 minutes of trading as investors watched the debate in Washington over spending cuts. U.S. Senate Democrats offered a new proposal that funds the government through Nov. 15, complicating efforts to avoid a government shutdown in a week as Republican Senator Ted Cruz began an extended speech in opposition to funding for the health-care law.

In corporate news, JP Morgan Chase & Co. lost 2.2% to $50.32 for the biggest retreat in the Dow. The lender resumed settlement talks with the U.S. as the government was preparing to sue the bank in California federal court alleging it misrepresented the quality of mortgage-backed securities it sold from 2005 to 2007, according to a person familiar with the matter.

Applied Materials gained 9.1% to $17.45 as the largest supplier of chip-making equipment agreed to acquire Tokyo Electron. Gary Dickerson, chief executive officer of Applied Materials, will become CEO of the combined company, which will be 68% owned by Applied Materials shareholders.

Facebook Inc. added 2.7% to $48.45 after Citigroup Inc.’s Mark May raised his recommendation on the social-network operator to “buy” from “neutral”, saying feedback from advertisers and agencies suggest that the growth seen in the second quarter is sustainable. The analyst also boosted his price estimate by 72% to $55 a share.