(For a Reuters live blog on U.S., UK and European stock

markets, click or type LIVE/ in a news window)

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Indexes down: Dow 0.26%, S&P 500 0.36%, Nasdaq 0.45%

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Solar stocks down as Senate proposes to phase out tax

credits

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Eli Lilly ( LLY ) to acquire Verve Therapeutics ( VERV ) for up to $1.3 bln

(Updates after markets open)

By Kanchana Chakravarty and Sukriti Gupta

June 17 (Reuters) -

Wall Street's main indexes slipped on Tuesday as the

Israel-Iran conflict entered its fifth day, denting global

investor confidence ahead of the Federal Reserve's upcoming

monetary policy decision.

Iran and Israel's air war, which began on Friday when Israel

attacked Iran's nuclear facilities, has raised concerns that the

conflict could create bottlenecks for oil exports from the

oil-rich Middle East.

"(Wall Street believes) that the situation is going to

be contained. The market is definitely paying attention to it,

but right now there's no panic in the market over it," said

Larry Tentarelli, chief technical strategist at Blue Chip Daily

Trend Report.

U.S. energy stocks rose as oil prices remained elevated on

the uncertainty. Chevron ( CVX ) was up 1.8% and Exxon

advanced 1.7%.

The surge in oil prices comes ahead of the Fed's monetary

policy decision on Wednesday, when policymakers are widely

expected to keep interest rates unchanged.

Money market moves show traders are pricing in about 46

basis points of rate cuts by the end of 2025, with a 57% chance

of a 25-bps rate cut in September, according to CME Group's

FedWatch tool.

At 10:05 a.m. ET the Dow Jones Industrial Average

fell 109.04 points, or 0.26%, to 42,406.05, the S&P 500

lost 21.71 points, or 0.36%, to 6,011.40 and the Nasdaq

Composite dropped 88.94 points, or 0.45%, to 19,612.28.

Ten of the 11 major S&P 500 sub-sectors fell. Healthcare

stocks dropped the most, with an about 0.8% decline. On

the flip side, energy stocks gained 1.6%.

Data on Tuesday showed U.S.

retail sales

dropped more than expected in May, while factory production

barely rose last month.

U.S. Senate Republicans late on Monday unveiled proposed

changes to President Donald Trump's sweeping tax-cut bill that

had cleared the House of Representatives in May.

Solar stocks dipped after the Senate's changes to Trump's

tax-cut bill revealed a phase-out of solar, wind and energy tax

credits by 2028.

Shares of Enphase Energy ( ENPH ) dropped 23.3% and Sunrun ( RUN )

fell 39.4%. Invesco Solar ETF was down 8.8%.

Shares of nuclear power companies rose after the Senate

extended credits for nuclear energy to 2036. Oklo ( OKLO ) was

up 3.3%, while Nano Nuclear Energy ( NNE ) rose 4.3%.

As investors flock to traditional safe-haven assets amid

heightened geopolitical uncertainty, a rise in U.S. Treasuries

pushed yields lower across the curve. Yields on the benchmark

10-year fell about 2 basis points to 4.43%.

Most megacap and growth stocks fell. Tesla lost

1.9%, while Alphabet was down about 1%.

Among other movers, Eli Lilly ( LLY ) fell 1.1% after it

agreed to acquire Verve Therapeutics ( VERV ) for up to $1.3

billion. Shares of Verve surged 73.7%.

T-Mobile fell 3.9% as Japan's SoftBank

raised $4.8 billion from a sale of 21.5 million of the wireless

carrier's shares at $224 each, according to a term sheet

reviewed by Reuters.

Declining issues outnumbered advancers by a 1.67-to-1 ratio

on the NYSE and by a 1.75-to-1 ratio on the Nasdaq.

The S&P 500 posted seven new 52-week highs and eight new

lows, while the Nasdaq Composite recorded 31 new highs and 50

new lows.