Wall Street: S&P 500, Dow slip over 1.2% as recession fears mount

US May factory orders rise more than expected; commodity-linked stocks, banks shares tumble

The S&P 500 and the Dow fell on Tuesday, with investors fretting about the possibility of a recession as central banks across the world take aggressive actions to stem a surge in inflation.

U.S. stocks have been under relentless selling pressure this year, with the benchmark S&P 500 index 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 now waiting for minutes from the Fed's meeting in June on Wednesday as they brace for another 75-basis-point rate hike at the end of the month.

Traders are also keeping a