Wall Street dips, but tech helps Nasdaq

By Ryan Vlastelica

NEW YORK (Reuters) - U.S. stocks slipped on Wednesday, with the Dow and S&P 500 pulling back from record levels, though strength in a number of large-cap tech names kept the Nasdaq near breakeven territory.

Wall Street has advanced but struggled for direction lately, with daily modest moves in either direction. The S&P 500's drop of 0.3 percent so far on Wednesday represented its biggest daily decline since May 20.

The stock market's upward trend is still deemed intact, but a lack of major trading catalysts could curb gains. The Dow ended at a fourth straight record high on Tuesday, while the S&P 500 closed lower after four days of record finishes.

Investors expressed caution after the surprising primary election defeat of Eric Cantor, the No. 2 Republican in the House of Representatives, by an upstart candidate from the Tea Party movement.

"This seems like it could increase Congress' tendency towards gridlock at a time when the country's problems are progressing, which is giving us an excuse to pullback," said Bruce McCain, chief investment strategist at Key Private Bank in Cleveland, Ohio.

"The defeat is part of the selloff, but we've also had a fair run that has taken us to new highs at a time when the fundamental picture is improving but still murky."

The CBOE Volatility Index rose 2.4 percent to 11.25 on Wednesday but remained well below its historical average of 20. In a sign of the market's low volatility, the 14-day Average True Range on the S&P 500 hit 10.09, the lowest since February 2013.

The Dow Jones industrial average fell 88.55 points or 0.52 percent, to 16,857.37. The S&P 500 slipped 5.62 points or 0.29 percent, to 1,945.17. The Nasdaq Composite dropped 2.90 points or 0.07 percent, to 4,335.10

The Nasdaq got a boost from Micron Technology, which rose 5.5 percent to $31.14 a day after Credit Suisse raised its price target on the stock to $50 from $30. Amazon.com Inc, up 1.4 percent at $337, also buoyed the Nasdaq. Amazon's gain came after Goldman Sachs reportedly added the e-commerce company's stock to its "conviction buy" list.

H&R Block Inc climbed 3.5 percent to $31.81 after reporting fourth-quarter results.

Orexigen Therapeutics Inc shares plunged 16.8 percent to $5.67 after the U.S. Food and Drug Administration delayed a decision on the marketing application for its obesity drug by three months.

Bank of America Corp has reached an impasse in negotiating a multibillion-dollar settlement with the U.S. Department of Justice relating to the bank's mortgage investments, according to The New York Times. The bank's stock dropped 1.7 percent to $15.65.

The World Bank cut its global economic growth forecast for 2014 to 2.8 percent from 3.2 percent late on Tuesday because of the impact of the Ukraine crisis and a harsh U.S. winter. However, with those issues largely in the rear-view mirror, the World Bank was confident that economic activity was shifting to a stronger footing.

(Editing by Bernadette Baum, Nick Zieminski and Jan Paschal)