- China ADRs slip on weak services activity data
- Airbnb, Blackstone gain on S&P 500 inclusion
- Indexes down: Dow 0.23%, S&P 0.33%, Nasdaq 0.35%
Sept 5 (Reuters) - Wall Street's main indexes fell on Tuesday as higher Treasury yields weighed on some major growth stocks, while downbeat data on services activity in China stoked worries over demand in the world's second largest economy.
The yield on the 10-year Treasury notes climbed to 4.23%, while two-year yield rose to 4.928% in the run-up to more economic data this week.
Major technology-linked stocks such as Apple, Amazon and Alphabet lost between 0.4% and 1.2%.
"Investors are grappling with what we consider to be a still relatively weak economic and profit environment for the average corporation," said Jason Pride, chief of investment strategy and research at Glenmede.
"The recession is definitely delayed within the United States ... we are seeing fairly weak economic environments in both China and Europe."
China's services activity expanded at the slowest pace in eight months in August, a private-sector survey showed, as weak demand continued to dog the world's second-largest economy and stimulus failed to meaningfully revive consumption.
U.S.-listed shares of Chinese companies including PDD Holdings, JD.com , Baidu and Alibaba fell between 0.5% and 2.9%.
The energy sector was a bright spot, up 0.9% tracking higher oil prices after Saudi Arabia and Russia announced a fresh extension to their voluntary supply cuts.
The S&P 1500 airlines index lost 2.5%.
U.S. economic data since the Fed's July meeting has added to the impression the economy is cooling without cracking, likely bolstering the case against further interest rate increases.
All three main U.S. stock indexes logged gains in the previous week after data pointed to a softening labor market.
As traders return after the Labor Day holiday, focus will now shift to the consumer price index data due next week and the Fed's policy decision due on Sept. 20.
Traders' bets that the Fed will leave rates unchanged in the next policy meeting stood at 93%, while pricing in a 58.2% chance of a pause in November, up from 52% a week earlier, according to the CME FedWatch tool.
Meanwhile, Goldman Sachs lowered the chances of a U.S recession in the next 12 months to 15% from 20% amid continued easing inflation and labor market data.
At 9:50 a.m. ET, the Dow Jones Industrial Average was down 78.72 points, or 0.23%, at 34,758.99, the S&P 500 was down 14.87 points, or 0.33%, at 4,500.90, and the Nasdaq Composite was down 49.11 points, or 0.35%, at 13,982.71.
Shares of Airbnb and Blackstone added 7.1% and 3.3%, respectively, in premarket trading as the companies were set to join the S&P 500 index.
Declining issues outnumbered advancers for a 3.13-to-1 ratio on the NYSE and a 1.97-to-1 ratio on the Nasdaq.
The S&P index recorded eight new 52-week highs and 13 new lows, while the Nasdaq recorded 27 new highs and 63 new lows.
Reporting by Shristi Achar A and Amruta Khandekar in Bengaluru; Editing by Arun Koyyur and Shounak Dasgupta
Source: Reuters