On this Brexit Eve, the market (as it has the past few sessions) shot way up right out the gate only to gradually settle down lower as the day progressed to close 49 points down.  The morning's good news regarding Q2 earnings and strong retail sales provided the initial trigger, with the looming Brexit doing the rest.  The relatively low volume of 6.3 billion shares attests to the fact that a good amount of cash sits on the sidelines awaiting the results of tomorrow's referendum in England.  The polls show it to be an even contest, but the good news is that there is a substantial 9% undecided.  Tempers running so hot, it's a good bet that those 9 percent who are not "hot under the collar" will realize by tomorrow that unity is far preferable to separation.  This may explain why the markets have not been in too much turmoil.  Of course, all that could violently change tomorrow.

Markets | Wed Jun 22, 2016 5:39pm EDT

Wall Street dips, all eyes on British referendum

BY RODRIGO CAMPOS

DJ:  17,780.83  -48.90       NAS: 4,833.32  -10.44         S&P:  2,085.45  -3.45

(Reuters)  U.S. stocks dipped in low trading volume on Wednesday, with traders focusing on Thursday's referendum on whether Britain will remain part of the European Union.  Stocks rose early after data showed U.S. home resales rose in May to a more than nine-year high, adding to retail sales and international trade data that painted an upbeat picture of the economy in the second quarter.

But the S&P 500 once more hit a ceiling at the 2,100 level, which has been an area where sellers cluster.

Attention remained on Britain's Thursday vote. A poll published on Wednesday showed a statistical tie, with the 'Leave' camp with 45 percent, just one point ahead of 'Remain,' and 9 percent undecided. Oddsmakers, however, showed a clear advantage for the 'Remain' camp.

"I go with the betting odds, that’s the better indicator," said Paul Zemsky, chief investment officer, Multi-Asset Strategies and Solutions at Voya Investment Management in New York.

He said despite not holding "a huge amount of risk" heading into the vote he is slightly overweight U.S. stocks.

"Earnings revisions are up, oil prices are at a sweet spot, retail sales have been strong; once you get past this unforecastable event (the referendum), people will put cash to work in the U.S. equity market," Zemsky said.

Investors also kept an eye on U.S. Federal Reserve Chair Janet Yellen's second day of testimony to Congress. She repeated her speech from Tuesday, in which she played down the risk of a recession, but warned that the British vote and a U.S. hiring slowdown posed risks to the economic outlook.

The Dow Jones industrial average .DJI fell 48.9 points, or 0.27 percent, to 17,780.83, the S&P 500 .SPX lost 3.45 points, or 0.17 percent, to 2,085.45 and the Nasdaq Composite .IXICdropped 10.44 points, or 0.22 percent, to 4,833.32.

The CBOE Volatility Index .VIX closed at 21.17, its highest in four months, indicating traders are more willing to pay for protection against a decline in the S&P 500.

About 6.3 billion shares changed hands in U.S. exchanges, compared with the 6.8 billion average over the last 20 sessions.

Tesla Motors (TSLA.O) was down 10.5 percent at $196.66 after the Elon Musk-owned electric car maker made an offer to buy his solar installation firm SolarCity (SCTY.O) in a deal worth as much as $2.8 billion. SolarCity was up 3.3 percent at $21.88

FedEx (FDX.N) fell 4.5 percent to $156.51 a day after it reported a quarterly loss.

Adobe Systems (ADBE.O) was down 5.7 percent at $94.01 after its second-quarter revenue and full-year revenue forecast just about met analysts' estimates.

Declining issues outnumbered advancing ones on the NYSE with a 1.44-to-1 ratio and on the Nasdaq, a 1.45-to-1 ratio favored decliners.

The S&P 500 posted 26 new 52-week highs and 3 new lows; the Nasdaq recorded 55 new highs and 56 new lows.