Stocks mixed: Nasdaq deeper into red for 2015

Stocks ended mixed in choppy trading Tuesday as Wall Street staged a partial rebound from Monday's sharp sell-off that edged the broad U.S. market ever closer to its 2015 lows hit in late August.

The Nasdaq's losing ways continued, though, as it lost 0.6% and sunk further into the red for 2015.

After initially struggling to gain traction, stocks jumped higher after a report showed consumers grew more confident in September despite increased market volatility. The Conference Board's consumer confidence index rose to 103.0 from 101.3 in August. Economists expected a drop to 97.

Consumer confidence rises in September despite market volatility

But investors were unable to hold onto those gains as stocks pulled back and headed lower in afternoon trading — then up again. The Dow Jones industrial average finished up 47 points, or 0.3%, after having risen as much as 118 points earlier in the session.

The Standard & Poor's 500 index ended up 0.1% after tumbling 2.6% Monday to 1881.77 — putting the broad U.S. stock gauge perilously close to its low for the year of 1867.61 back on Aug. 25, a scary low that followed a 1,000-point drop in the Dow Jones industrial average a day earlier on Aug. 24.

The Nasdaq composite index added to its 3% drop on Monday.

The volatile trading was worrisome as the so-called "retest" of the S&P 500's August lows is what Wall Street was focused on. The market's failure to hold those levels means the S&P 500, which kicked off Tuesday's trading session down 11.7% from its May 21 record close and off 8.6% for the year, could have farther to fall. The closely watched stock index is on track for its worst quarter since the third quarter of 2011.

How the market reacts when stocks get down to the August lows is critical, Wall Street pros say. The storyline is simple: If the market holds at those levels, a floor could develop under the market. If the old lows don't hold, prices will go even lower in search of lower support levels.

Stock market on collision course with Aug. lows

"If the testing of the low in August does not hold the next level to test (for the S&P 500) will likely be around 1800," or more than 4% lower than Monday's close, says Patrick Adams, a money manager at Choice Investment Management. "The true risk and concern is the support around 1870 (or the lows in late August)."

Adams told clients he believes Wall Street has seen the highs for this cycle at 2130 on the S&P 500.

A bear market, or 20% decline, would be 1704, he adds.

Stock markets around the world continue to be worried about a slew of worries, ranging from slowing growth in China and the resulting wreckage in the commodity space to questions about the timing of the Federal Reserve's first interest rate hike in nearly a decade and signs that overpriced assets boosted by cheap money from the Fed in recent years are in full-fledged price corrections.

Those worries have resulted in stocks suffering their first price correction of 10% or more in four years. And the current corrective phase -- and swelling losses -- seems to have amped up the worry level on Wall Street.

Shares in Asia closed down sharply Tuesday, extending the declines from Wall Street on Monday. The Nikkei 225 in Japan tumbled 4.1%, leaving it in the red for 2015. Stocks that trade on Hong Kong's Hang Seng index fell 3% and shares of mainland China's Shanghai composite declined 2%. European markets also fell with the FTSE 100 in London down 0.8%, Germany's DAX index fell 0.4% and was 0.4% lower in the CAC 40 in Paris.

Heading into Tuesday's trading session, the Dow Jones industrial average is down 12.6% from its recent record close. The S&P 500 is 11.7% below its peak, the Nasdaq is 12.9% from its high and the small-company Russell 2000 index is nearly 16% from its peak in late June.