The Standard & Poor's has snapped a three day winning streak after mixed earnings reports and a fall in consumer confidence, but analysts said US stocks were taking a breather and the rally could pick back up.

Solid earnings from Dow component DuPont and Cummins Inc cheered investors, but that was offset by gloomy comments from steelmakers, including US Steel Corporation and AK Steel Holding Corporation.

Mr Nick Kalivas senior equity index analyst at MF Global in Chicago said that "I still have a favorable view of the market, but I think the extreme move in the last few days warrants some consolidation or pullback."

The S&P closed a hair below its 200 day moving average after crossing above it on Monday. While the failure to hold above the level was a potentially bearish signal, the fact that it ended so close to the level made it less negative.

The index's 14 day moving average line crossed over its 50 day moving average, creating a so called golden cross that indicates positive short term momentum.

Economic data was mixed. Home prices rose in May, but labor market worries took July consumer confidence to its lowest since February.

But steelmakers gave a less rosy picture, with AK Steel saying it was cutting production capacity to match weak demand, while US Steel reported a net loss that missed Wall Street's expectations.

AK Steel lost 4.7% to USD 14.49 and US Steel gave up 6.4% at USD 45.76. An S&P materials sector index slipped 0.6%.

According to a report from the Conference Board, consumer confidence fell in July to its lowest point since February, hurt by worries about the job market.

(Sourced from www.abs-cbnnews.com)