By Anna Isaac and Paul Vigna

U.S. stocks eased off their record pace Tuesday after a round of weak earnings reports from retailers.

The Dow Jones industrial Average fell 0.1% to 28013. The S&P 500 dropped less than 0.1%, and the Nasdaq Composite gained 0.1%. All three indexes closed at record levels Monday.

U.S. stocks have had a relatively muted start to the week. Investors are taking a more neutral stance in their assessment of risks, rather than a defensive position, according to Florian Ielpo, head of macroeconomic research at asset-management firm Unigestion.

"Markets were thinking a recession was imminent at the end of August, now people are discovering that it is less bad than that," Mr. Ielpo said. "Pessimism is starting to fade."

That might change. Retail stocks were in focus Tuesday morning, as the group begins reporting third-quarter earnings. Dow component Home Depot shares fell 5%, after the retailer trimmed its expectations for sales growth. Shares of Kohl's dropped more than 15% after it lowered its profit guidance for the year.

The disappointing outlook from both companies weighed on the stocks of other U.S. retailers, as investors grew concerned about the health of a sector that has been strong so far this year. Macy's, which is scheduled to report earnings later in the week, fell 7.6% while Nordstrom declined 4.5%. Gap slumped 1.9%.

Meanwhile, discount retailer TJX rose 2.9% after its earnings report showed a strong rise in sales.

Globally, stocks edged higher as investors grew less apprehensive about the economic outlook and the prospects for a U.S.-China trade deal in the absence of fresh shocks. Hong Kong's Hang Seng Index ended the day up almost 1.6%, while the Shanghai Composite gauge advanced 0.9%.

Meanwhile, the pan-continental Stoxx Europe 600 index rose 0.3%.

The ICE dollar index, which tracks the greenback against a basket of currencies, dropped sharply immediately after President Trump said he met with Federal Reserve Chairman Jerome Powell at the White House Monday and "protested" about U.S. interest rates being too high. The gauge has pared back most of those losses in the hours since.

Mr. Trump, who has been vocal in his criticism of the central bank, tweeted that he discussed the state of the economy, trade issues, and the impact of a "too strong" dollar with the central bank chief. The Fed said Mr. Powell reiterated that he hoped interest-rate cuts earlier this year would bolster the economy.

The yield on the U.S. 10-year Treasurys slipped to 1.798%, from 1.808% on Monday.

Write to Anna Isaac at anna.isaac@wsj.com and Paul Vigna at paul.vigna@wsj.com

(END) Dow Jones Newswires

November 19, 2019 10:19 ET (15:19 GMT)

Copyright (c) 2019 Dow Jones & Company, Inc.