US equities open mostly lower after two-day rally

Wall Street started the week mostly lower, retreating from a two-day rally as investors await key earnings reports from big retailers.

About 30 minutes into the first trading day of the week, the Dow Jones Industrial Average was flat at 33,759.44.

The broad-based S&P 500 was down 0.4 percent to 3,978.83, while the tech-rich Nasdaq Composite Index dropped 1.0 percent, to 11,208.18.

Stocks jumped late last week after closely-watched inflation data were more tame than expected, offering hope the Federal Reserve might slow the aggressive pace of interest rate increases, and perhaps not hike quite as much as anticipated.

"This morning, however, there is a little bit of questioning as to whether the market overreacted last week," said Briefing.com analyst Patrick J O'Hare.

And Adam Sarhan of 50 Park Investments said "There's a tug of war between the bulls and the bears" on the direction for the market.

He told AFP the bears could prevail if retail earnings show the American consumer is losing steam.

Investors will be watching quarterly reports from Walmart, Target, Lowe's and Home Depot, among others, which will serve as a proxy for consumer demand.

Walmart, which is due to release earnings Tuesday before the open, was flat in early trading.