NEW YORK (AP) - Stock markets around the world downshifted into neutral on Tuesday, and U.S. indexes edged lower in early trading a day after setting record highs. Bond yields climbed after Fed Chair Janet Yellen told Congress that the Fed is still on track for more interest rate increases and understands the risk of waiting too long to raise borrowing rates.
KEEPING SCORE: The S&P 500 dipped 5 points, or 0.2 percent, to 2,323 as of 10:45 a.m. Eastern time. The Dow Jones industrial average fell 16 points, or 0.1 percent, to 20,395. The Nasdaq composite lost 12 points, or 0.2 percent, to 5,751. The Russell 2000 index of smaller U.S. stocks fell 2 points, or 0.1 percent, to 1,390. Roughly two stocks fell for every one that rose on the New York Stock Exchange.
TAKING A PAUSE: Indexes are stalling following a strong run driven by stronger-than-expected corporate earnings, an improving economy and expectations for more help for businesses from Washington. On Monday, the S&P 500 and the Nasdaq composite each rose for the fifth straight day and set records. The S&P 500 is up 8.6 percent since Election Day and the Nasdaq has surged 11 percent.
FED WATCH: Yellen, in her first testimony before Congress since President Donald Trump took office, said the Fed recognizes that sharp changes in fiscal policy could influence the Fed's decisions, referring implicitly to the ambitious economic program Trump has promised. Many economists think Trump's stimulus program could put pressure on the Fed to tighten credit more quickly to stave off inflation. The central bank raised rates in December for just the second time in a decade.
INFLATION GAUGE: Inflation has been low across the world for years, but a sharp pickup could force the Federal Reserve into raising rates even more quickly. A government report on Tuesday showed that inflation at the wholesale level was 1.6 percent in January, compared with prices a year earlier. That was in line with economists' expectations, who say overall inflation appears to still be in check.
BOND YIELDS: U.S. government bond prices fell following Yellen's comments as investors anticipated more interest rate increases. The yield on the 10-year Treasury note rose to 2.50 percent, up from 2.43 percent late Monday. The yield on the 2-year Treasury rose to 1.24 percent from 1.21 percent.
BABY, YOU CAN BUY MY CAR COMPANY: General Motors jumped 4 percent following news that France's PSA Group, maker of Peugeot and Citroen cars, is exploring a deal to buy Opel, GM's money-losing European business. GM rose $1.50 to $37.04.
CANCEL MY ORDER: Popeye's Louisiana Kitchen slumped $3.86, or 5.5 percent, to $66.96, giving back most of the previous day's gain. The stock jumped 7.2 percent Monday after Reuters said Restaurant Brands International, the parent of Burger King and Tim Horton's, approached the chicken chain and might buy it. The New York Post said Tuesday that Restaurant Brands considered in a deal a few months ago but lost interest.
Restaurant Brands lost 38 cents, or 0.8 percent, to $53.42 following a 4.6 percent jump Monday.
MAJOR LASERS: Cynosure, which makes devices used in laser body contouring, hair removal and skin care, soared after agreeing to be bought by medical device maker Hologic. Hologic will pay $66 a share, or $1.57 billion, for Cynosure, which had about $434 million in revenue in 2016. Cynosure climbed $14.40, or 28 percent, to $65.90 while Hologic skidded $1.37, or 3.4 percent, to $38.65.
That's the second day in a row that a large health care company agreed to buy a laser aesthetics company. On Monday Allergan agreed to buy Zeltiq Aesthetics for $2.48 billion.
GLOBAL MARKETS: Stocks were relatively steady across the world. In Europe, the German DAX index dipped 0.1 percent, while the French CAC 40 and British FTSE 100 each edged up by 0.1 percent. In Asia, the Hang Seng index in Hong Kong was close to flat, while the South Korean Kospi index dipped 0.2 percent and the Japanese Nikkei 225 index fell 1.1 percent.
COMMODITY REBOUND: Benchmark U.S. crude oil rose 64 cents to $53.56 per barrel. A day earlier, it had lost 93 cents. Brent crude, the international standard, rose 75 cents to $56.33 per barrel.
Natural gas fell a penny to $2.93 per 1,000 cubic feet.
Gold rose $8.20 to $1,234.00 per ounce, silver added 16 cents to $17.98 per ounce and copper slipped a penny to $2.77 per pound.
CURRENCIES: The dollar held steady at 113.62 Japanese yen. The euro rose to $1.0616 from $1.0600 late Monday, and the British pound dipped to $1.2471 from $1.2529.
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AP Business Writer Elaine Kurtenbach contributed from Tokyo.