The S&P 500 ended slightly higher on Tuesday as investors kept their focus on the growth trajectory of the US economy. The tech-heavy Nasdaq also closed higher, while the Dow slipped.

US stocks have been under relentless selling pressure this year, with the benchmark S&P 500 recording its steepest first-half percentage drop since 1970, as the Federal Reserve moves away from easy-money policy by raising borrowing costs.

Investors are waiting for minutes from the Fed's June meeting to be made available on Wednesday as they brace for another 75-basis-point rate hike at the end of the month.

Traders are also keeping a watch on economic data, including a June nonfarm payrolls report expected on Friday, and on company commentaries for signs of peaking inflation and cooling economic growth, with another earnings season around the corner.

Data showed new orders for US-manufactured goods increased more than expected in May, reflecting that demand for products remains strong even as the Fed seeks to cool the economy.

Separately, business growth across the euro zone slowed further in June and European natural gas prices surged again, reigniting worries of a recession in the bloc.

"The risks of an outright recession are nonzero and the probability is growing at this point that a recession could emerge later this year, or perhaps even into early 2023," said Bill Northey, senior investment director at US Bank Wealth Management in Minneapolis. "And the US labour market continues to look quite healthy."

The Dow Jones fell 0.42 percent to 30,967, the S&P 500 gained 0.16 percent to 3,831 and the Nasdaq added 1.75% to 11,322.

Benchmark US Treasury yields tumbled on Tuesday and a key part of the yield curve inverted for the first time in three weeks as economic growth concerns dented risk appetite and increased demand for the safe-haven US debt. (Reuters)