The S&P 500 and the Nasdaq fell on Tuesday as investors fretted about an economic downturn from aggressive interest rate hikes around the world to tamp down inflation. Focus is now on inflation data on Wednesday that is expected to show US consumer prices rose 8.8pc in June from a year earlier, marking a fresh four-decade high and adding more pressure on the US Federal Reserve to act on soaring prices. Analysts are also tempering their profit estimates as the earnings season kicks off in earnest this week, with results from JPMorgan Chase & Co, Citigroup Inc and Wells Fargo & Co, among others. “When you’re faced with as many inputs as we’re going to see this week … it’s not unusual for investors to take a risk-off attitude,” said Art Hogan, chief market strategist at B. Riley. “If (earnings) estimates for the second half don’t go down and actually go up a little bit, that’s going to shed some of the concern that we’re slamming on the brakes and the economy is getting into a recession.” Overall S&P 500 earnings are expected to rise 5.7pc in the second quarter, compared with the earlier forecast of 6.8pc, according to IBES data from Refinitiv. A stronger-than-expected jobs report last week cemented expectations for a second straight 75-basis-point rate hike later this month. Investors will be watching out for speeches by Fed officials this week for any change in the central bank’s hawkish stance on inflation. Adding to worries of slowing global growth, several cities in China are adopting fresh COVID-19 curbs from this week to rein in new infections after finding a highly transmissible Omicron subvariant. All three benchmark indexes ended lower in the previous session, after posting solid gains last week, with most market-leading growth stocks yet again dragging down the Nasdaq. on Tuesday. At 10:05 a.m. ET, the Dow Jones Industrial Average was up 9.94 points, or 0.03pc, at 31,183.78, the S&P 500 was down 15.08 points, or 0.39pc, at 3,839.35, and the Nasdaq Composite was down 76.82 points, or 0.68pc, at 11,295.78. The S&P 500 energy sector fell 2.6pc, and was the top sectoral decliner, as oil prices posted sharp declines on a weaker demand outlook. Airline stocks rose, with the S&P 1500 Airlines index up 4.1pc. PepsiCo Inc raised its full-year revenue forecast, helped by sustained demand for its sodas and snacks, sending the company’s shares up 0.5pc. Gap Inc slid 5.6pc after the clothing retailer said its CEO would step down and its margins would stay under pressure in the second quarter as costs spiral. Advancing issues outnumbered decliners for a 1.08-to-1 ratio on the NYSE, while declining issues outnumbered advancers for a 1.47-to-1 ratio on the Nasdaq. The S&P index recorded one new 52-week high and 29 new lows, while the Nasdaq recorded six new highs and 68 new lows.