By Amy Caren Daniel

(Reuters) - U.S. stocks rose on Tuesday, when markets close early ahead of the July 4 holiday, boosted by energy stocks, but gains were capped by a drop in technology stocks, with Facebook sliding on renewed concerns over its data scandal.

Facebook dropped 1.9 percent after the Washington Post reported a federal probe on the data breach linked to Cambridge Analytica was broadened and will include more government agencies.

The social media company's stock weighed on the S&P technology sector, which fell 0.37 percent.


Nine of the 11 main S&P 500 sectors were higher, led by a 0.88 percent jump in the energy sector. Energy stocks held on to their gains even though crude oil prices reversed course shortly after the market opened as traders booked profits. [O/R]

Trade tensions continued to fester, with President Donald Trump on Monday warning the World Trade Organization of "doing something" if United States is not treated properly.

Also looming is a July 6 deadline when Washington is set to impose tariffs on $34 billion worth of Chinese goods.

"In the short term, company fundamentals are quite solid and the economy is strong," said Brant Houston, managing director at CIBC Private Wealth Management.

"But with the trade war looming there is a lot of uncertainty and a lot of unknowns, until we get more clarity there it is difficult for investors to jump back into the equity market."

Shares of American Airlines, United Continental and Delta Air Lines fell between 1.2 and 2.2 percent after Deutsche Bank downgraded all three stocks saying the growing U.S.-China trade dispute could weigh on their results.

At 11:21 a.m. EDT the Dow Jones Industrial Average was up 32.94 points, or 0.14 percent, at 24,340.12, the S&P 500 was up 3.42 points, or 0.13 percent, at 2,730.13 and the Nasdaq Composite was down 2.80 points, or 0.04 percent, at 7,564.88.

The stock market will close at 1 p.m. ET, ahead of the Fourth of July holiday, and trading volumes are expected to be light.

Tesla fell 5.1 percent, declining for the second straight session on questions over whether it could sustain the pace of making its Model 3 cars.

Economic data was mixed. New orders for U.S.-made goods unexpectedly rose in May, pointing to a strengthening manufacturing sector, but business spending on equipment continued to show signs of slowing.

Advancing issues outnumbered decliners by a 3.21-to-1 ratio on the NYSE and 2.06-to-1 ratio on the Nasdaq.

The S&P index recorded three new 52-week highs and two new lows, while the Nasdaq recorded 68 new highs and 21 new lows.

(Reporting by Amy Caren Daniel in Bengaluru)