US stock indexes opened lower on Tuesday as investors paused after a recent record-breaking rally that helped the Dow notch up nine straight sessions of record close.
Investors are also awaiting earnings reports from retailers to conclude a largely positive second-quarter earnings season.
“New record highs were registered last week as the flow of earnings continued positive with major corporations offering positive guidance going forward,” said Peter Cardillo, chief market economist at First Standard Financial.
“Nevertheless, now that the winding down of the second-quarter season has begun, the remainder of August is likely to encounter increasingly sluggish volume, with the indices staying mostly range bound.”
Trading volume is also expected to be relatively tepid with summer setting in and with the US Congress on vacation.
The S&P hasn’t had a move of more than 0.5 per cent since July and has fallen more than 1 per cent only twice this year.
Second-quarter earnings have been stronger than expected with analysts, on average, expecting S&P 500 earnings to have expanded 12 per cent in the quarter, compared with 8 per cent at the start of July, according to Thomson Reuters I/B/E/S.
At 9:38 a.m. ET (1338 GMT), the Dow Jones Industrial Average .DJI was down 31.4 points, or 0.14 per cent, at 22,087.02, the S&P 500 .SPX was down 4.19 points, or 0.16 per cent, at 2,476.72.
The Nasdaq Composite .IXIC was down 13.81 points, or 0.22 per cent, at 6,369.96.
Ten of the 11 major S&P sectors were lower, with the healthcare index’s .SPXHC 0.35 per cent fall leading the decliners.
Retail earnings are in focus with Amazon.com looming large over the sector. Macy’s .M.N, Kohl’s, JC Penney are expected to report results this week, with Wal-Mart, Target due next week.
Shares of Michael Kors jumped 17 per cent after the retailer raised its full-year revenue outlook.
Ralph Lauren was up 10.97 per cent after the luxury apparel retailer’s quarterly results beat expectations.
Marriott International was down 3.32 per cent as the world’s largest hotel chain narrowed its forecast for the revenue it expects to earn this year from its rooms in North America.
