US stocks slip as traders assess signs of slowing economy

Wall Street stocks stumbled early Tuesday after a long weekend, as investors digested signs of a slowing US economy on cooler hiring figures released last week.

Shortly after trading began, the Dow Jones Industrial Average slipped 0.1 percent to 34,813.78.

The broad-based S&P 500 fell 0.3 percent to 4,503.68, while the tech-heavy Nasdaq Composite Index slumped 0.4 percent to 13,972.41.

On Friday, US Labor Department data showed that unemployment picked up in August while wage gains moderated — signs that the red-hot labor market is cooling.

But amid heightened hopes that inflation can be reduced without triggering a major downturn, Goldman Sachs cut its probability of the US suffering a recession to 15 percent.

"The hesitation now is partly a function of last week's solid returns, which came on light volume, and some assumptions that the market might have a little cooling off period," said Patrick O'Hare of Briefing.com.

He added that the main market drivers "have a mostly company-specific angle" with Airbnb and Blackstone shares rising after news that they would be added to the S&P 500.

Airbnb rose 7.1 percent while Blackstone edged up 3.2 percent.

While the market had a big rally this year, it paused in August to assess these moves and "now investors are looking for clues on what the rest of the year will bring," said Adam Sarhan of 50 Park Investments.

"We saw more economic weakness out of China. We saw more economic weakness out of Europe," he said, adding that China has been a good proxy for the global economy.

"There's not a lot of confidence in this rally for many reasons," he said.

Meanwhile, British chipmaker Arm said Tuesday it is aiming for a valuation of up to $52 billion when it lists on the Nasdaq this month.