U.S. stocks slipped from records Tuesday as investors awaited earnings reports from the biggest technology giants.

The S&P 500 dropped 0.5%, while the Dow Jones Industrial Average fell 0.7%, or about 230 points. The tech-heavy Nasdaq Composite lost 0.5%. The three indexes closed at all-time highs Monday.

U.S. stocks have been grinding higher as investors cheer strong corporate results and upbeat guidance from some of the largest American businesses. At the same time, concerns are lingering over the Delta-variant of Covid-19, supply-chain problems, a spike in inflation and cooling economic growth.

“We’ve been characterizing this market as a jetliner that has lifted off and is coming out of the Covid-19 air pocket, but is still trying to find an appropriate cruising altitude,” said Kara Murphy, chief investment officer at Kestra Holdings. “We are seeing economic data going from great levels to good levels: that is still indicative of economic growth.”

Fresh data showed that orders for cars, appliances and other durable goods increased in June, indicating continued strength in the economy. But the 0.8% increase in new orders was below the 2% gain estimated by economists surveyed by The Wall Street Journal.

Among individual stocks, shares of General Electric rose 1.4% after the manufacturer reported higher orders for its industrial machinery. United Parcel Service shares fell 7.6% after weaker than expected results from its domestic business.

Earnings reports from behemoths including Microsoft, Apple and Google parent Alphabet after markets close Tuesday could offer insights into how those companies are faring as lockdowns end and supply constraints for key products persist. Visa and Starbucks are also among the companies that will publish results, making it a blockbuster day in the earnings season.

Lucid Motors began trading on the Nasdaq stock exchange after completing its business combination with Churchill Capital Corp IV, July 26, 2021.

Lucid Motors began trading on the Nasdaq stock exchange after completing its business combination with Churchill Capital Corp IV, July 26, 2021.

Photo: andrew kelly/Reuters

“We have seen earnings expectations continue to be ratcheted up quite significantly, but lots of companies are still beating expectations,” said Ms. Murphy.

In bond markets, the yield on the benchmark 10-year U.S. Treasury note ticked down to 1.231% from 1.276% on Monday. Bond yields and prices move in opposite directions.

Overseas, the Stoxx Europe 600 fell 0.6%. Hong Kong’s Hang Seng Index slumped 4.2% as a selloff of tech stocks deepened, driven by concerns about China’s regulatory crackdown in recent days. In mainland China, the Shanghai Composite Index fell 2.5%.

The meltdown in China is weighing on investors’ appetite for stocks in other markets, but the contagion effect is likely to be limited, according to Altaf Kassam, head of investment strategy for State Street Global Advisors in Europe.

“The drag on sentiment will be there because China has been the engine of global growth for years now and seeing its stock market suffer like this is going to put a question mark on global growth,” Mr. Kassam said. “Anything that weighs on global growth is going to have an effect on markets, but it is going to be a second-order story for global markets.”

Social-media giant Tencent Holdings fell 9% while Hong Kong-listed shares of Alibaba Group, China’s biggest e-commerce company, shed more than 6% by the close of trading.

—Karen Langley contributed to this article.

Write to Will Horner at William.Horner@wsj.com