U.S. stocks limped to the close, with many investors looking ahead to Wednesday's key inflation report and what it might mean for interest rates.

The major indexes edged lower for a second straight session, and oil prices rose.

Uncertainty over the Federal Reserve's next moves, the standoff between the U.S. and Iran and whether the AI build-out is oversold or overhyped have all clouded the outlook for stocks. Many investors are proceeding with caution.

"It's kind of like the 'Enter Sandman' market -- sleep with one eye open, hold your pillow tight," said Matt Stucky, chief portfolio manager of equities at Northwestern Mutual Wealth Management.

For now, all eyes are on Wednesday's inflation report for July and the remaining batch of quarterly corporate earnings. Economists expect July's inflation report to show consumer prices up 3.4% from a year earlier, a slight improvement from the 3.5% inflation rate in June. And corporate earnings have so far exceeded expectations to record levels.

The S&P 500, which reached a record high last week, fell 0.3% for its second straight drop. The Dow declined 0.3%, or 184 points.

The tech-heavy Nasdaq Composite Index fell 0.6%.

"I think we've come off of a pretty violent correction in the AI trade," said Drew Cupps, portfolio manager at Polen Capital. Recent back-and-forth and sideways moves among memory and electrical equipment companies are a "very healthy market behavior that lays a good foundation for, potentially, a market advance in the quarters ahead."

Brent crude futures gained around 1.4% at nearly $89 a barrel Tuesday. They touched $90 early in the day as hopes for a Strait of Hormuz deal faded, then fell back after signs of de-escalation, and finally jumped up to near intraday highs as U.S. attacks resumed.

Yields on 10- and 30-year Treasurys posted their largest single-day declines in nearly a week to close at 4.683% and 5.235%, respectively, though overall rates remain near their year-to-date highs. Bond yields fall as prices rise.

Some investors said the crop of record corporate earnings have distracted the markets from volatile oil prices and their effect on supply chains.

"Investors, in general, have the memories of goldfish. They swim around the bowl and say, 'Oh, look, a castle.' And then swim around the bowl again -- 'Oh, look, a castle,'" said Jason Hendricks, portfolio manager at Crestwood Advisors. "They focus on the castle that's right in front of them and forget that it's going to come around again."