By Anora Mahmudova and Carla Mozee, MarketWatch
NEW YORK (MarketWatch) -- The U.S. stock market on Monday gave
up some of last week's gains that sent the Dow Jones Industrial
Average above 17,000 for the first time.
Investors took a step back to reassess Thursday's
stronger-than-expected jobs report while awaiting second-quarter
earnings that start trickling in this week.
The S&P 500 (SPX) closed 7.8 points, or 0.4%, lower at
1,977.65, with only the defensive sectors, such as utilities,
telecoms and consumer staples, ending with modest gains.
The Dow Jones Industrial Average (DJI) fell 44.05 points, or
0.3%, to 17,024.21. The Nasdaq Composite (RIXF) was dragged down by
losses in biotech and Internet companies, ending the day down 34.4
points, or 0.8%, to 4,451.53.
The Russell 2000 (RUT) underperformed other benchmarks, falling
21.41 points, or 1.8%, to 1,186.44.
Read the recap of MarketWatch's live blog of today's
stock-market action.
Kristina Hooper, U.S. investment strategist at Allianz Global
Investors, said investors overreacted to last week's jobs data, as
it's likely that inflation, not a stronger economy, will be what
pushes the Fed to raise interest rates.
"Investors are digesting and rereading the jobs report, hence we
are saying markets pausing after record levels. Still, we think
markets are too liberal in expecting rate hikes in the second half
of 2015 and will be surprised if it happens sooner," she said.
The new earnings season begins Tuesday with results from
aluminum producer Alcoa Inc. (AA) after the bell. Another highlight
is Wells Fargo & Co. (WFC) on Friday.
Earnings for the S&P 500 are expected to rise by 4.9% for
the quarter, according to FactSet, and with stock prices extending
their reach to new highs, investors are likely to be less forgiving
if companies miss Wall Street's expectations. Analysts have reduced
their earnings estimates by the lowest amount since the second
quarter of 2011, said John Butters, senior earnings analyst at
FactSet.
Among individual companies, American Apparel Inc. (APP) rallied
1.7% after The Wall Street Journal reported the retailer is in
talks to raise new financing following the ouster of CEO Dov
Charney.
Apple Inc.(AAPL) rose 2.1% on big gains in June sales ahead of a
busy fall season. For more stock movers, read Movers and Shakers
column.
In the commodities market, oil futures settled lower, with the
U.S. oil benchmark (CLQ4) slipping below $104 a barrel
Gold futures(GCQ4) settled at their lowest level in more than a
week, extending losses from the previous session.
Asian stocks closed mostly lower, with Japan's Nikkei Average
down 0.4%, and European stocks fell after an unexpected and steep
drop in German industrial production raises worries about
growth.
The dollar (DXY) extended gains into a fourth consecutive day,
with traders considering whether the U.S. jobs report for June adds
more pressure on the Fed to raise interest rates sooner than
later.
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