By Medha Singh
(Reuters) – On Tuesday, US stocks dropped investors over a hit to the company's earnings from the long-standing US-China trade conflict and reined in expectations of a major interest rate cut by the Federal Reserve later in the past month.
In the latest indication of commercially damaging injuries, the German chemical giant BASF (DE 🙂 was warned about a 30% fall in adjusted annual profits, while RBC Capital Markets down-adjusted 3M Co (N 🙂 to "sector
industrial conglomerate shares fell 1
19659002] China-exposed stocks slipped out.  Boeing Co (N :), the largest single US exporter to China, declined 0.3% before the release of their orders and deliveries for the second quarter, while Caterpillar Inc (N 🙂 fell 0.2%.
The Philadelphia chip index () fell 0.21%, as chipmakers, who get a large portion of their revenue from China, fell.
The shares have declined from record high since a robust job in June reports on Friday hardened the expectation of an aggressive 50 basis point cut by the Fed.
"It is certainly nervousness over … the fact that no (trade) agreement is reached or seems so close and that recent jobs report the question of how quickly the Fed is likely to lower prices, says Rick Meckler, partner, Cherry Lane Investments in New Vernon, New Jersey .
"Without the two elements being favorably resolved, it is difficult for the market to push even higher levels when it has already received so much this year."  The United States and China are able to resume trade negotiations this week After a two-month termination, but a year after their trade war began, there is little evidence that their differences have narrowed.
Focus this week will be on Fed boss Jerome Powell's remarks on his two-day testimony before Congress, starting Wednesday. Also on Wednesday is the central bank's June meetings for police meetings.
At 09:37 ET, the Dow Jones Industrial Average () was 74.98 points, or 0.28%, of 26,731.16. The S&P 500 () was down 6.77 points, or 0.23% at 2,969.18 and the Nasdaq Composite () was down 10.23 points, or 0.13%, at 8.088.16.
The banking companies were down 0.29% before a Fed conference to discuss the effectiveness of their major lender stress tests.
Network provider Cisco Systems Inc (O 🙂 slipped 0.4% on a deal to buy optical component maker Acacia Communications Inc (O 🙂 for $ 2.84 billion in cash. Acacia's shares increased 34.9%.
The quarterly revenue season is expected to begin seriously next week, with surpluses on the S & P 500 companies down 0.2% from the previous year, according to Refinitive IBES data.
Decreases constitute outstanding promoters for a 2.47 to 1 ratio on the NYSE and for a 1.70 to 1 ratio on Nasdaq.
The S&P index recorded seven new 52-week highs and no new lows, while Nasdaq recorded 10 new heights and 14 new downs.