Wall Street opens lower ahead of Fed meeting

U.S. stocks pulled back on Tuesday from a rally in the previous session ahead of a Federal Reserve meeting that investors hope will bring insight on the timing of an interest rate hike.

The Federal Open Market Committee is due to start a two-day meeting on Tuesday and is expected to put out its statement and projections on Wednesday afternoon.

Most economists expect the Fed to remove a pledge to be "patient" about raising interest rates from its statement, giving it flexibility on when to kick off its first rate hike since 2006.

U.S. housing starts plunged to their lowest level in a year in February likely as harsh weather kept builders at home, in the latest indication the economy hit a soft patch in the first quarter.

The benchmark S&P 500 index on Monday saw its biggest percentage gain since Feb. 3. Last week, the Dow and S&P registered their third week of losses.

Some investors were giving back gains in the absence of big news while others were holding tight ahead of the Fed statement, said Art Hogan, chief market strategist at Wunderlich Securities in New York.

"We're very much in a wait-and-see mode until 2.30 p.m. tomorrow," said Hogan.

At 9:38 a.m., the Dow Jones industrial average fell 91.77 points, or 0.51%, to 17,885.65, the S&P 500 lost 6.39 points, or 0.31%, to 2,074.8 and the Nasdaq Composite dropped 6.04 points, or 0.12%, to 4,923.47.

Retailer DSW Inc's shares were up 6% at $39.14 after a better-than-expected outlook, while Burlington Stores' shares were up 2.9% to $59 after its quarterly report.

Shares in American Airlines rose 6% to 53.25 after news that it would join the S&P 500.

Black Diamond Inc shares rose 28.8% $9.08. The outdoor pursuits equipment and clothing company said it hired advisors to explore strategic alternatives and it reported quarterly results.

Brent crude fell below $54 a barrel in choppy trade as concerns over a growing supply glut weighed on the market. U.S. crude was at $43.11 a barrel, down 57 cents and slightly above 6-year lows of $42.85 marked on Monday.

Declining issues outnumbered advancing ones on the NYSE by 1,829 to 450, for a 4.06-to-1 ratio; on the Nasdaq, 1,440 issues fell and 602 advanced, for a 2.39-to-1 ratio favoring decliners.

The S&P 500 was posting 3 new 52-week highs and 1 new low; the Nasdaq Composite was recording 18 new highs and 20 new lows.