Stocks nearly recovered all losses Tuesday afternoon as the Federal Reserve's latest policy meeting began and investors digested the state of the IPO market following Instacart's public debut on the Nasdaq.

The S&P 500 (^GSPC) and the Nasdaq Composite (^IXIC) slipped about 0.2%. The Dow Jones Industrial Average (^DJI) dropped about 0.3%, or 106 points.

The Federal Open Market Committee began its meeting Tuesday morning at 10:30 a.m. as the path forward for interest rates remains in focus amid the Fed's fight against inflation.

With investor bets now pricing in a 99% chance the Fed will hold rates steady, according to the CME FedWatch Tool, much of the investor focus is on what Fed Chair Jerome Powell says about the November meeting and any new indication on future moves from the updated Summary of Economic Projections, or the so-called "dot plot."

"Fed officials have signaled that they can afford to proceed carefully at this point and will leave the target range for the funds rate unchanged at 5.25-5.5% at their September meeting," Goldman Sachs chief US economist David Mericle wrote in a research note previewing the meeting. "The immediate question for markets is whether the median dot will continue to project an additional hike this year to 5.5-5.75%, presumably in November. We think that it will, but only by a narrow majority, and in part for the strategic purpose of preserving flexibility."

Elsewhere, investors will be closely following Instacart, which began trading Tuesday afternoon on the Nasdaq under the ticker CART. The stock quickly rose nearly 40% from its set IPO price of $30 a share. By the market close, Instacart had given back some gains and was up 12% on the day.

The grocery delivery chain was valued at roughly $10 billion entering its first day of trading. Some IPO experts have told Yahoo Finance that the grocery delivery service's public market debut could be an indicator of where the IPO market stands on its path to recovery.

In commodities, rising oil prices have been in focus as gas prices hit a fresh 2023 high on Monday. West Texas Intermediate (CL=F) was down 0.3% Tuesday, just above $91 a barrel. Brent crude (BZ=F) slipped 0.1% to about $94 a barrel.

The United Auto Workers (UAW) strike continued into Tuesday after UAW announced late Monday that it will hold workers out of more Stellantis (STLA), GM (GM), and Ford (F) plants if no progress in contract negotiations is made by Friday.