By Will Horner 

U.S. stocks slipped Tuesday, weighed down by declines in technology shares.

The Dow Jones Industrial Average fell 117 points, or 0.4%, to 26611. The S&P 500 declined 0.7% and the Nasdaq Composite lost 1.1%.

Major indexes drifted along in a narrow range to start the trading day, then lost ground after a Federal Reserve official known for his vocal opposition to interest-rate increases said he believed it was too early for a 50-basis-point rate cut.

Also Tuesday, Fed Chairman Jerome Powell weighed in on the debate, saying while many Fed officials find the case for somewhat more accommodative policy has strengthened, "we are mindful that monetary policy should not overreact to any individual data point or short-term swing in sentiment."

Earlier, stock declines deepened while the dollar broke above the flatline after comments from James Bullard, president of the Federal Reserve Bank of St. Louis.

Hopes that the Fed will lower interest rates to offset a slowdown in economic growth have helped major indexes rally in June. That is even as many investors remain worried about the course of trade talks between the U.S. and China.

The yield on the 10-year Treasury had fallen as low as 1.982% earlier Tuesday, but climbed back above 2% in recent trading.

"Prudence is still justified because obviously the bar is quite high for a truce between the U.S. and China on tariffs at this week's G-20," said Kenneth Broux, a senior strategist at Société Générale. "The danger is of course that everything ends in acrimony and the whole moves of the past week or so reverse if the U.S. decides to raise tariffs to 25% on the remaining $300 billion [of Chinese goods]."

Technology shares lagged behind major indexes Tuesday, with Facebook falling 1.7% amid scrutiny over its plan to roll out its own cryptocurrency, Libra. Lawmakers said on Monday they would hold a hearing next month to discuss the cryptocurrency.

Other companies whose privacy practices have lately come under fire among regulators retreated, with Alphabet down 2% and Amazon.com down 1.1%.

Meanwhile, Allergan shares jumped 27% after rival drugmaker AbbVie said it would buy the company for more than $60 billion. AbbVie slipped 15%.

Elsewhere, the Stoxx Europe 600 edged down 0.1%, weighed down by losses among bank stocks.

French consulting firm Capgemini and smaller rival Altran Technologies soared after the two companies agreed to merge, with Capgemini up 8.4% and Altran shares up 22%.

In commodities, gold jumped 0.7%, extending a rally that has propelled prices to their highest level since 2013.

Gold prices have been lifted by "a positive cocktail of factors," from lingering global-growth worries and U.S.-China trade tensions to escalating fears of a conflict between the U.S. and Iran, said Carsten Menke, a commodities analyst at Julius Baer.

"If you take everything together you have quite a bullish environment for gold. Then you have technical levels which have been broken like $1,380 or $1,400 and that's why we've had such a sharp rally," he said.

Earlier, Japan's Nikkei Stock Average fell 0.4%, while the Shanghai Composite fell 0.9% and snapped a six-session winning streak.

Akane Otani contributed to this article.

(END) Dow Jones Newswires

June 25, 2019 13:45 ET (17:45 GMT)

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