At 9:53 a.m. ET, the blue-chip Dow slipped 0.2%, or 86.47 points, to 42,568.27; the broad S&P 500 dropped 0.6%, or 35.85 points, to 5,922.53; and the tech-heavy Nasdaq fell 0.81%, or 155.65 points, to 19,

Investors will get the first chance to react to Moody’s downgrade of the U.S. credit rating late Friday over rising government debt and they’ll also look for more progress from President Trump on trade deals as the week kicks off.

U.S. stock index futures were muted on Friday as investors were risk-averse after President Donald Trump's tax and spending bill won a crucial House vote the previous day, raising concerns about the country's deteriorating fiscal outlook.

Stocks have suffered their first meaningful pullback since regaining their momentum in a rally that took them off last month's lows and more than erased the losses suffered after the April 2 rollout of President Donald Trump's sweeping tariff measures.

US stocks managed to eke out gains on Monday as bond yields eased off bigger gains and Wall Street largely shrugged off Moody's downgrade of the US credit rating. Meanwhile, investors digested developments in President Trump's tariff salvos.

The S&P 500 recently flashed a technical sell signal, Bank of America said, which can suggest a near-term drop in stock prices.

This was the stock's second consecutive day of losses.

U.S. stocks closed higher after an unsurprising US credit rating downgrade. Treasury yields rise. S&P 500 extends winning streak to six days.