China's stocks fell more than 6% overnight and that has intensified fears of a third devaluation of the yuan in as many weeks.  Thus, commodities across the board took another plunge, this time to a near six-year low.  That combined with a very disappointing Q2 report from giant Walmart sinking to its lowest point in 2-1/2 years brought the Dow down 33 points.  Considering that news of this magnitude has caused sheer panic in the recent past, it is a tribute to the market's flexibility that losses were contained at 33 points.  The minimal loss was partly due to a very strong home builders report that showed housing starts at a near 8 year high.  Still, at 5.4 billion, volume was once again considerably below average which means the majority of investors are not yet reacting to this news.

Markets | Tue Aug 18, 2015 5:28pm EDT

Wal-Mart, materials shares drag Wall St. lower

BY RODRIGO CAMPOS

DJ:  17,511.34  -33.84       NAS:  5,059.35  -32.35         S&P: 2,096.92  -5.52

REUTERS/BRENDAN MCDERMID

U.S. stocks fell on Tuesday, with the S&P 500 trading in its tightest daily range in nearly a month, weighed down by earnings-related selling in Wal-Mart and a drop in commodity stocks on concerns about China's economy.

Wal-Mart (WMT.N) fell 3.4 percent to close at $69.48, its lowest in nearly 2-1/2 years, after its profit missed estimates and it cut its outlook.

Chinese stocks fell more than 6 percent overnight. Fears that Beijing may be intent on a deeper devaluation of the yuan pushed oil prices and industrial metals, including copper, to near six-year lows.

The materials sector .SPLRCM was the largest decliner among the top ten industry sectors with a 0.7 percent decline. Freeport McMoRan (FCX.N) fell 3.1 percent to $9.92.

"You would think that a 6-percent China move amid the recent currency adjustments would have netted a more negative result," said Andre Bakhos, managing director at Janlyn Capital LLC in Bernardsville, New Jersey.

He said the market has not found a reason to break lower or test record highs, so "it’s been a rubber-band kind of mentality."

The Dow Jones industrial average .DJI fell 33.84 points, or 0.19 percent, to 17,511.34, theS&P 500 .SPX lost 5.52 points, or 0.26 percent, to 2,096.92 and the Nasdaq Composite.IXIC dropped 32.35 points, or 0.64 percent, to 5,059.35.

Homebuilders continued on a winning streak after data showed U.S. housing starts rose to a near eight-year high in July. The PHLX housing sector index .HGX rose 1.3 percent for an eighth straight session of gains.

"Housing starts was a very good number, with positive revisions, and I think that caught the market’s eye," said Doug Coté, chief market strategist at Voya Investment Management.

Underscoring the strength of the homebuilding sector, Home Depot (HD.N) rose 2.6 percent to $122.80, a record closing high.

TJX (TJX.N) jumped 7.2 percent to close at a record high of $76.78 after same-store sales beat estimates.

Dow component Disney (DIS.N) fell 1.9 percent to $106.94 after Wells Fargo cut its rating on the stock and five other media companies, including CBS (CBS.N). CBS fell 1.4 percent to $49.35.

Declining issues outnumbered advancing ones on the NYSE by 1,975 to 1,064, for a 1.86-to-1 ratio; on the Nasdaq, 1,906 issues fell and 890 advanced, for a 2.14-to-1 ratio favoring decliners.

The S&P 500 posted 41 new 52-week highs and 9 new lows; the Nasdaq was recording 69 new highs and 85 new lows.

About 5.4 billion shares exchanged hands in U.S. exchanges, below the 6.7 billion daily average so far this month, according to BATS Global Markets data.