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Banks index drops to seven-week low

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Crypto stocks fall as bitcoin hits one-week low

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GM approves $6 billion share buyback plan

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Indexes lower: Dow 0.62%, S&P 0.29%, Nasdaq 0.02%

(Updated at 12:10 pm ET/1610 GMT)

By Lisa Pauline Mattackal and Johann M Cherian

June 11 (Reuters) -

Wall Street's main indexes slipped on Tuesday as investors

turned cautious ahead of a crucial inflation reading and a

policy announcement from the Federal Reserve expected this week,

although a recovery in Apple's ( AAPL ) shares helped curtail losses.

Shares of Apple ( AAPL ) rebounded 5.5%, crossing the

$200-mark and hitting an all-time high. They had declined in the

previous session following the release of the iPhone-maker's

much-awaited AI strategy at a developer conference.

That helped limit losses on the Nasdaq and the S&P

500. However, stocks fell broadly, with 10 of the 11

major S&P 500 sectors in the red, as markets readied for

Wednesday's release of the Consumer Price Index report for May

and the conclusion of the Fed's two-day policy meeting.

"I think you're seeing investors, particularly

short-term investors, move a little bit to the sidelines to

avoid the potential for an adverse Fed statement," said Rick

Meckler, partner at Cherry Lane Investments.

The central bank is not expected to change rates but

will release its updated economic projections and "dot plot",

which shows where policymakers expect interest rates to stand

this year and longer term.

The CPI numbers and the Fed's projections will be

scrutinized after recent reports sent out conflicting signals on

the economy's underlying health.

Markets have dialed back expectations for the Fed's first

rate cut happening in September, now pricing in about a 50%

chance, according to the CME's FedWatch tool. Rate futures also

imply just one cut this year, compared to two before Friday's

bumper Nonfarm Payrolls data.

"Will the Fed change the guidance in their language

tomorrow, maybe? Markets are in a kind of back-and-forth with

the Fed because they are expecting something to happen," said

Richard Christopher Whalen, chairman of Whalen Global Advisors.

Major banks including JPMorgan Chase & Co ( JPM ), Citigroup ( C/PN )

and Bank of America ( BAC ) dropped over 2%, sending the

broader banking index into a seven-week low.

Other rate-sensitive growth stocks slipped, with Microsoft ( MSFT )

, Meta Platforms ( META ) and Amazon.com ( AMZN )

falling between 0.5% and 1%, while Tesla slid 3.2%

At 12:10 p.m. ET, the Dow Jones Industrial Average

was down 241.30 points, or 0.62%, at 38,626.74, the S&P 500

was down 15.65 points, or 0.29%, at 5,345.14, and the

Nasdaq Composite was down 4.07 points, or 0.02%, at

17,188.46.

The small-cap Russell 2000 Index dropped

0.8

%.

Prison operators CoreCivic ( CXW ) and Target Hospitality ( TH )

slumped 20.3% and 35.1%, respectively, after the U.S.

Immigration and Customs Enforcement said it would close a

detention center in Texas.

Cryptocurrency-linked stocks slipped as bitcoin slid,

with bitcoin miners Riot Platforms ( RIOT ) and Marathon Digital ( MARA )

and crypto exchange Coinbase falling between

4% and 5%.

General Motors ( GM ) gained nearly 2.1% after the automaker

announced a $6 billion share buyback plan.

Cleveland-Cliffs ( CLF ) dropped 4.8% after brokerage

J.P.Morgan downgraded the steel stock to "neutral" from

"overweight".

Declining issues outnumbered advancers for a 2.40-to-1

ratio on the NYSE, and for a 1.97-to-1 ratio on the Nasdaq.

The S&P index recorded 14 new 52-week highs and four new

lows, while the Nasdaq recorded 28 new highs and 102 new lows.