A wobbly day on Wall Street ended Tuesday with major indexes slipping just below recent record highs, but the S&P 500 closed out August solidly in the green with its seventh straight monthly gain.

Investors are busy trying to figure out just how much of an impact rising COVID-19 cases will have on the still recovering economy. The market has been choppy amid a mix of economic data, some of which has signalled that consumers are becoming more cautious.

The S&P 500 index fell 6.11 points or 0.1 per cent, to 4,522.68, after setting a record high a day prior. The Dow Jones Industrial Average fell 39.11 points, or, 0.1 per cent, to 35,360.73 and the Nasdaq slipped 6.65 points, or less than 0.1 per cent, to 15,259.24.

Technology stocks were the biggest weight dragging down the benchmark S&P 500, despite more stocks rising than falling within the index. Smaller company stocks fared better than the broader market in a signal that investors were somewhat confident about continued economic growth. The Russell 2000 rose 7.78 points, or 0.3 per cent, to 2,273.77.

The ASX is set for losses, with futures at 6.59am AEST pointing to a fall of 33 points, or 0.4 per cent, at the open. The Australian dollar strengthened to be 0.3 per cent higher at 73.13 US cents at 8.06am AEST.

“The market is still really dealing and grappling with the question of what direction are we taking,” said Rob Haworth, senior investment strategist at US Bank Wealth Management.

Investors are gauging which areas of the market are poised to benefit in the coming months as supply constraints continue to hamper some industries while COVID-19 continues to threaten the economic recovery, he said. The uncertainty has contributed to shifting gains and losses for services-oriented sectors and other areas of the economy that typically do well in a growing economy.

Despite the choppiness, the S&P 500 powered through August for a 2.9 per cent gain. That marks seven straight monthly gains, the longest such streak since early 2018. The Nasdaq closed the month with a 4 per cent gain.

The market has been lifted by a number of factors this month. Corporate earnings came in much better than expected, giving investors confidence to pay premium prices for an already lofty market. Also the Federal Reserve has made it clear that it believes inflation will be temporary and any pullback of financial support from the central bank would be gradual.