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US: Stocks dip as rally shows fatigue

[NEW YORK] Wall Street stocks retreated in early trading Friday as investors took advantage of recent gains in the wake of the Federal Reserve's more dovish posture to sell shares.

Following a dismal performance in May, US stocks have rallied in June. The S&P 500 pushed to a record close on Thursday after the Fed signaled Wednesday it could soon cut interest rates.

"The stock market has come a long way in a short amount of time, catalyzed by visions of rate cuts dancing in the heads of participants," said analyst Patrick O'Hare.

But large gains often are followed by profit taking, and about 20 minutes into trading, the Dow Jones Industrial Average stood at 26,731.11, down 0.1 per cent.

The broad-based S&P 500 shed 0.2 per cent to 2,947.90, while the tech-rich Nasdaq Composite dropped 0.4 per cent to 8,017.53.

Analysts are looking ahead to next week's Group of 20 leaders' summit in Japan, particularly for a meeting between US President Donald Trump and China's Xi Jinping that could lead to a breakthrough in the long-running US-China trade dispute.

Another wildcard is the escalation of tensions between the US and Iran. Mr Trump confirmed Friday that he called off a strike on Iran after Iran shot down a US drone, saying in a tweet that he did not want to cause mass casualties.