US open: Stocks fall as traders assess data and earnings

US stocks fell on Tuesday as investors digested economic data and quarterly earnings.

The Dow Jones Industrial Average dropped 0.41%, the S&P 500 declined 0.54% and the Nasdaq slid 0.62% at 1517 BST.

In contrast oil prices rebounded from lows the previous day. West Texas Intermediate crude rose 1.7% to $40.79 per barrel and Brent increased 2.09% to $43.04 per barrel.

The personal consumption expenditure index, the Federal Reserve’s preferred inflation barometer, increased 0.9% year-on-year in June, unchanged from in the prior month and in line with expectations. The annual rate of core inflation was flat at 1.6%, as expected. The Federal Reserve is targeting 2% inflation.

Personal spending rose 0.4% in June, beating estimates of 0.4% growth, while personal incomes climbed 0.2%, missing forecasts for a 0.3% increase.

The data comes ahead of Friday’s all-important non-farm payrolls report. Analysts believe the Fed needs to see a strong jobs report and upbeat economic data before raising interest rates.

Dallas Federal Reserve Bank President Robert Kaplan on Tuesday urged caution on trying to increase rates amid global risks that could affect the US.

"I am closely monitoring how slowing growth, high levels of overcapacity and high levels of debt to GDP in major economies outside the US might be impacting economic conditions in the US," Kaplan said at an event in Beijing.

Company-wise, Procter & Gamble Co. advanced after reporting quarterly earnings and revenue that surpassed expectations.

Mallinckrodt rallied after the pharmaceutical manufacturer reported better-than-expected third quarter results.

CVS Health Corp. gained after the drugstore operator’s earnings per share in the second quarter beat estimates.

Ford Motor slumped after reporting a drop in US vehicle sales in July.

Pfizer Inc. declined despite reporting quarterly results that exceeded expectations.