After failing to sustain an initial move to the upside, stocks came under pressure over the course of the abbreviated trading session on Tuesday. The major averages pulled back off their highs of the session and into negative territory.
The major averages ended the session just off their worst levels of the day. The Dow fell 132.36 points or 0.5 percent to 24,174.82, the Nasdaq slid 65.01 points or 0.9 percent to 7,502.67 and the S&P 500 dropped 13.49 points or 0.5 percent to 2,713.22.
The pullback by stocks came amid lingering trade concerns as tariffs on billions of dollars worth of U.S. and Chinese goods are set to take effect later this week.
In a move that could further inflame trade tensions between the U.S. and China, President Donald Trump's administration has recommended blocking China Mobile from offering telecommunications services from within the U.S.
A statement from the National Telecommunications and Information Administration, an agency of the Commerce Department, attributed the recommendation to national security concerns.
"After significant engagement with China Mobile, concerns about increased risks to U.S. law enforcement and national security interests were unable to be resolved," said David Redl, NTIA Administrator and Assistant Secretary of Commerce for Communications and Information.
Redl said the NTIA subsequently recommends that the Federal Communications Commission deny China Mobile's Section 214 license request.
Trading activity was light ahead of an earlier than normal close for the , with many traders looking to get a head start on the July 4th holiday.
On the U.S. economic front, the Commerce Department released a report showing an unexpected rebound in new orders for manufactured goods in the month of May.
The Commerce Department said factory orders climbed by 0.4 percent in May after falling by a revised 0.4 percent in April.
Economists had expected orders to come in unchanged compared to the 0.8 percent decrease originally reported for the previous month.
Semiconductor stocks showed a significant move to the downside over the course of the trading session, dragging the Philadelphia Semiconductor Index down by 1.8 percent.
With the decrease on the day, the semiconductor index more than offset the modest gain posted in the previous session, falling to its lowest closing level in two months.
Considerable weakness also emerged among computer hardware and banking stocks, with the NYSE Arca Computer Hardware Index and the KBW Bank Index falling by 1.3 percent and 1.2 percent, respectively.
On the other hand, substantial strength remained visible among gold stocks, as reflected by the 2.1 percent jump by the NYSE Arca Gold Bugs Index.
The rally by gold stocks came amid a rebound by the price of the precious metal, with gold for August delivery surging up $13.40 to $1,255.10 an ounce.
In overseas trading, stock markets across the Asia-Pacific region turned in a mixed performance during trading on Tuesday. Japan's Nikkei 225 Index edged down by 0.1 percent, while China's Shanghai Composite Index rose by 0.4 percent.
Meanwhile, the major European markets all moved to the upside on the day. While the U.K.'s FTSE 100 Index climbed by 0.6 percent, the French CAC 40 Index and the German DAX Index advanced by 0.8 percent and 0.9 percent, respectively.
In the bond market, treasuries turned higher over the course of the session after seeing initial weakness. As a result, the yield on the benchmark ten-year note, which moves opposite of its price, has dropped by 2.8 basis points to 2.838 percent.
Following the holiday, traders are likely to keep a close eye on the minutes of the latest Federal Reserve meeting on Thursday as well as the Labor Department's monthly jobs report on Friday.
by P2PNews Staff Writer