US STOCKS-Wall St dips as regulatory fears hit Alphabet, Amazon

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* Yields on 10-yr U.S. Treasury fall further
* Google, Amazon slip on regulatory scrutiny
* U.S. manufacturing activity grows at slowest in 2-1/2
years
* Indexes fall: Dow 0.24%, S&P 0.28%, Nasdaq 0.83%

(Updates prices to open)
By Medha Singh and Amy Caren Daniel
June 3 (Reuters) - U.S. stocks slipped on Monday as internet
giants Alphabet and Amazon tumbled on regulatory concerns, but
hopes that the United States would settle its dispute with
Mexico helped limit some losses.
Alphabet Inc GOOGL.O declined 6.4% after sources told
Reuters said the U.S. Justice Department is preparing an
investigation of the Google-parent to determine whether the
company broke antitrust laws in operating its online businesses.
Amazon.com AMZN.O slipped 3.5% after a report that the
e-commerce giant could face heightened antitrust scrutiny under
a new agreement between U.S. regulators. "Big tech has been a favorite of investors and if they
decide that risks from antitrust will take a turn for the worst
for them then that is going to going to have an impact on the
market as a whole," Meckler added.
Their fall weighed on the communication services .SPLRCL
and the consumer discretionary sectors .SPLRCD .
Weak data also weighed on sentiment. The latest ISM survey
showed U.S. manufacturing growth surprisingly slowed in May to
its weakest pace in more than two-and-a-half years. Market uncertainty has sent investors fleeing for safety in
bonds, which pushed yields on U.S. two-year notes to their
biggest two-day fall since 2008, reflecting growing conviction
that the Federal Reserve will start cutting interest rates to
stave off recession. US/
Offering some respite, Mexican officials said the country
could reach an agreement with the Unites States to resolve a
dispute over migration that prompted President Donald Trump to
threaten punitive tariffs last week, which resulted in Wall
Street's main indexes ending May 6% lower. "Investors will remain concerned about trade until there is
a resolution, particularly the Mexico situation, which is
capable of being resolved," said Rick Meckler, partner, Cherry
Lane Investments, New Vernon, New Jersey.
At 10:01 a.m. ET the Dow Jones Industrial Average .DJI was
down 58.94 points, or 0.24%, at 24,756.10. The S&P 500 .SPX
was down 7.76 points, or 0.28%, at 2,744.30 and the Nasdaq
Composite .IXIC was down 61.99 points, or 0.83%, at 7,391.16.
Healthcare stocks .SPXHC , the worst performing sector this
year, rose 0.37%, and supported the market, helped by Humana Inc
HUM.N and Merck & Co MRK.N .
Merck rose 1% as investors were optimistic about data that
showed nearly a quarter of patients who received immunotherapy
Keytruda as an initial treatment for advanced lung cancer were
still alive after five years. Humana gained 5.5% after the company said it would not make
a proposal to combine with health insurer Centene Corp CNC.N ,
which plunged 8.4%. Boeing Co BA.N , the single largest U.S. exporter to China,
fell 2.9% and was the biggest drag on the bluechip Dow index.
Cypress Semiconductor Corp CY.O surged 23.2% after German
chipmaker Infineon Technologies agreed to buy the U.S. peer in a
deal valued at 9 billion euros ($10.1 billion). Advancing issues outnumbered decliners by a 1.95-to-1 ratio
on the NYSE and by a 1.23-to-1 ratio on the Nasdaq.
The S&P index recorded four new 52-week highs and 12 new
lows, while the Nasdaq recorded 11 new highs and 72 new lows.