Health care companies were broadly lower.
Banks and materials companies were rising in early trading Tuesday.
Overall, the data suggested that most employers have looked past risks from a global slowdown and the U.S.
Wall Street got through the bulk of third-quarter earnings season last week, and the results were much better than what investors had been anticipating.
Another bullish sign was seeing the Dow Jones Industrial Average (DIA) join the party.
The Dow popped toward an all-time high for a second straight day.More news: Queen Latifah As Ursula
The Dow rose 30.52 points, or 0.11 percent, to 27,492.63 points and the Nasdaq increased 1.48 points to 8,434.68, both building on record-highs achieved Monday.
Gold was unchanged at $1,508.00 an ounce.
This ISM survey measures business conditions and sentiment.
"It's very clear we're seeing lots of celebration in the market, not just in stocks, but in emerging market assets such as the yuan and coming out of havens like the Japanese yen", said Jane Foley, head of foreign exchange strategy at Rabobank.
While still in expansionary territory, Non-Manufacturing PMI missed economist estimates by a wide margin last month, printing a 52.6 versus an expectation of 55.1.
Any reading above 50 denotes economic growth in the sector.More news: Kylie Jenner & Drake Are 'Sending Time Together,' Sparking Romance Rumors
Services sector PMI unexpectedly plunged in September.
Investors also parsed new data showing that activity in the USA service sector grew at a faster pace in October than in September. The cut in interest rates by the Federal Reserve last week has added to investors' optimism, she said. It suggested that the economy remains resilient.
However, that support does not appear imminent.
Stocks inched higher at the open in NY, with the Dow and the Nasdaq Composite hitting intraday all-time highs.
Tuesday's record-highs came after the United States and China began to assess current tariffs on Chinese imports as the two countries work to finalize the "phase one" trade deal announced in October. Trade war doves might be pleased to hear that the Trump administration is considering the request and may roll back tariffs on $112 billion worth of China-produced consumer goods, which have been subject to a 15% levy since September 1. -China trade talks take yet another turn for the worse, but investors likely need to see only incremental improvements, to keep the momentum going, Stringfellow said. The "phase one" pact with China had been expected to deter President Trump from imposing new tariffs on December 15, but negotiators now are working on a plan that would also roll back some existing tariffs, The Wall Street Journal reported. Educational and other services along with wholesale trade declined.
USA stocks took a breather on Tuesday, weighed down partially by losses in healthcare stocks, after a rally driven by hopes of a trade truce between Washington and Beijing propelled the three main indexes to record highs a day earlier.More news: Video captures Hong Kong lawmaker stabbing
"My observation is that there's such intensity between China and the USA that Europe fell off the cliff and is not seen on the radar of Beijing any more", Wuttke said, according to the South China Morning Post.