Washington: US stocks opened lower on Tuesday as investors digested a mixed bag of economic data. The Dow Jones Industrial Average fell 100 points in early trading, while the S&P 500 and Nasdaq Composite indexes were both down 0.5%.
Investors were looking ahead to a key report on US manufacturing activity due later in the day. The Institute for Supply Management (ISM) is expected to report that manufacturing activity slowed in July. A reading below 50 would signal contraction in the sector.
Other economic data released on Tuesday showed that US construction spending rose in June, but at a slower pace than expected.
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The mixed economic data is adding to uncertainty among investors about the direction of the economy. The Federal Reserve is expected to raise interest rates later this year in an effort to combat inflation, but there are concerns that such moves could slow economic growth.
"Investors are still trying to figure out what the Fed is going to do and how that's going to impact the economy," said Quincy Krosby, chief market strategist at LPL Financial. "There's a lot of uncertainty right now."
The stock market has been volatile in recent weeks as investors have weighed the risks of a recession against the potential for higher inflation. The S&P 500 is down about 10% from its all-time high in January.
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The market is likely to remain volatile in the near term as investors continue to assess the economic outlook. The ISM manufacturing report and other economic data due later in the week will be closely watched by investors.
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In addition to the economic data, investors will also be watching the earnings season, which is set to get underway next week. Analysts are expecting earnings growth to slow in the second quarter, as companies grapple with rising costs and supply chain disruptions.
The stock market is likely to remain volatile in the near term as investors assess the economic outlook and earnings season. However, the long-term outlook for the stock market remains positive, as the US economy is still growing and corporate profits are expected to continue to rise.