US stocks pulled back from record levels on Tuesday, as techs handed back gains made on hopes of a preliminary US-China trade deal and Wells Fargo slid in a mixed start to big banks’ quarterly earnings.

Kicking off fourth-quarter earnings season, the largest US bank JPMorgan Chase & Co rose 2.1 per cent after reporting a better-than-expected profit as strength in its trading and underwriting businesses offset weakness in consumer banking.

Wells Fargo & Co dropped 2.7 per cent after reporting a 55 per cent slump in profit, as it set aside $US1.5 billion ($A2.2 billion) toward legal expenses, while Citigroup Inc rose 1.9 per cent as it topped Wall Street profit estimates.

The S&P 500 banks index was up 0.7 per cent.

Technology big guns that took Wall Street to record highs recently, Inc, Apple Inc, Microsoft Corp, Alpahbet Inc and Facebook Inc, shed between 0.3 per cent and 1.5 per cent.

Analysts expect profits at S&P 500 companies to drop 0.7 per cent for the second consecutive quarter, according to Refinitiv IBES data, largely due to a drag in energy and industrial earnings that have been hit by a prolonged trade war.

China has pledged to buy nearly an additional $US80 billion ($A116 billion) of manufactured goods from the US over the next two years, and over $US50 billion ($A72 billion) more in energy supplies, Reuters reported, citing a source briefed on the trade deal that is expected to be signed on Wednesday.

“Expectations are for flat to negative earnings this quarter and I don’t think there are any surprises,” said Peter Cecchini, chief market strategist at Cantor Fitzgerald in New York.

“Investors are requiring an earnings inflection next year, and if we don’t get it, that will be the catalyst for risk-off (trading).”

At 9:59 local time, the Dow Jones Industrial Average was down 13.20 points, or 0.05 per cent, at 28,893.85, the S&P 500 was down 8.31 points, or 0.25 per cent, at 3,279.82 and the Nasdaq Composite was down 43.87 points, or 0.47 per cent, at 9,230.06.

Delta Air Lines Inc rose 4.1 per cent after reporting a better-than-expected quarterly profit, boosted by customers gained from rival airlines’ 737 MAX cancellations. The S&P 1500 airlines index rose three per cent.

Medical device maker Boston Scientific Corp slid 6.9 per cent after reporting early fourth-quarter sales at the low-end of its previous forecast.

Declining issues outnumbered advancers for a 1.40-to-1 ratio on the NYSE and a 1.66-to-1 ratio on the Nasdaq.

The S&P index recorded 38 new 52-week highs and no new lows, while the Nasdaq recorded 78 new highs and 16 new lows.