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* Banks index drops to seven-week low

* Crypto stocks fall as bitcoin hits one-week low

* GM approves $6 billion share buyback plan

* Indexes lower: Dow 0.62%, S&P 0.29%, Nasdaq 0.02%

June 11 (Reuters) -

Wall Street's main indexes slipped on Tuesday as investors turned cautious ahead of a crucial inflation reading and a policy announcement from the Federal Reserve expected this week, although a recovery in Apple's shares helped curtail losses.

Shares of Apple rebounded 5.5%, crossing the $200-mark and hitting an all-time high. They had declined in the previous session following the release of the iPhone-maker's much-awaited AI strategy at a developer conference.

That helped limit losses on the Nasdaq and the S&P 500. However, stocks fell broadly, with 10 of the 11 major S&P 500 sectors in the red, as markets readied for Wednesday's release of the Consumer Price Index report for May and the conclusion of the Fed's two-day policy meeting.

"I think you're seeing investors, particularly short-term investors, move a little bit to the sidelines to avoid the potential for an adverse Fed statement," said Rick Meckler, partner at Cherry Lane Investments.

The central bank is not expected to change rates but will release its updated economic projections and "dot plot," which shows where policymakers expect interest rates to stand this year and longer term.

The CPI numbers and the Fed's projections will be scrutinized after recent reports sent out conflicting signals on the economy's underlying health.

Markets have dialed back expectations for the Fed's first rate cut happening in September, now pricing in about a 50% chance, according to the CME's FedWatch tool. Rate futures also imply just one cut this year, compared to two before Friday's bumper Nonfarm Payrolls data.

"Will the Fed change the guidance in their language tomorrow, maybe? Markets are in a kind of back-and-forth with the Fed because they are expecting something to happen," said Richard Christopher Whalen, chairman of Whalen Global Advisors.

Major banks including JPMorgan Chase & Co, Citigroup and Bank of America dropped over 2%, sending the broader banking index into a seven-week low.

Other rate-sensitive growth stocks slipped, with Microsoft , Meta Platforms and Amazon.com falling between 0.5% and 1%, while Tesla slid 3.2%

At 12:10 p.m. ET, the Dow Jones Industrial Average was down 241.30 points, or 0.62%, at 38,626.74, the S&P 500 was down 15.65 points, or 0.29%, at 5,345.14, and the Nasdaq Composite was down 4.07 points, or 0.02%, at 17,188.46.

The small-cap Russell 2000 Index dropped



Prison operators CoreCivic and Target Hospitality slumped 20.3% and 35.1%, respectively, after the U.S. Immigration and Customs Enforcement said it would close a detention center in Texas.

Cryptocurrency-linked stocks slipped as bitcoin slid, with bitcoin miners Riot Platforms and Marathon Digital and crypto exchange Coinbase falling between 4% and 5%.

General Motors gained nearly 2.1% after the automaker announced a $6 billion share buyback plan.

Cleveland-Cliffs dropped 4.8% after brokerage J.P.Morgan downgraded the steel stock to "neutral" from "overweight."

Declining issues outnumbered advancers for a 2.40-to-1 ratio on the NYSE, and for a 1.97-to-1 ratio on the Nasdaq.

The S&P index recorded 14 new 52-week highs and four new lows, while the Nasdaq recorded 28 new highs and 102 new lows.

(Reporting by Lisa Mattackal and Johann M Cherian in Bengaluru; Editing by Pooja Desai)