By Anora Mahmudova and Sara Sjolin, MarketWatch

Verizon to buy Yahoo in $4.8 billion deal

U.S. stocks lost ground Monday, retreating from record levels as investors turned cautious ahead of a busy week of earnings and central bank meetings.

A drop in oil prices weighed on sentiment, hitting energy companies once again, with the sector selling off 2%.

The S&P 500 fell 12 points, or 0.5%, to 2,163, with nearly all 10 main sectors trading lower. The Dow Jones Industrial Average declined 104 points, or 0.5%, to 18,465, with Chevron Corp (CVX), General Electric Co (GE), and Exxon Mobil Corp (XOM) leading the losses.

Meanwhile the Nasdaq Composite shed 13 points, or 0.3%, to 5,086.

Last week's move to all-time highs by the S&P 500 and the Dow "suggest investors are not worried about the impact of the Brexit vote," said Maris Ogg, president at Tower Bridge Advisors, referring to the June 23 U.K. vote to leave European Union that initially shocked financial markets.

Ogg cautioned not to read too much into the levels because trading volumes are generally low.

"People assume not much will happen, as the Federal Reserve is likely to keep rates on hold until after the election," Ogg said.

The Federal Reserve kicks off its monetary policy meeting on Tuesday and will announce its decision on Wednesday at 2 p.m. Eastern time. The central bank is widely expected to hold interest rates steady and stop short of signaling a possible rate increase in September because of continued uncertainty about the economic outlook.

Read:What to expect in the Fed statement this week (http://www.marketwatch.com/story/what-to-expect-in-the-fed-statement-next-week-2016-07-22)

The Bank of Japan's rate decision is due on Friday local time and will be closely watched for any hints of more easing in the face of a stronger yen post Brexit and a slowdown in the economy. In total, 15 central banks are scheduled (http://www.marketwatch.com/story/wall-street-braces-for-feeding-frenzy-of-earnings-central-bank-action-2016-07-23) to meet this week.

Some technical analysts pointed out that the rapid advance may find obstacles ahead.

"While the SPX has finally broken out, we can't expect the seemingly unobstructed advance to continue with nary a hiccup. Yes, it has been impressive, and breadth is still undeniably strong. But at some point momentum will slow, and the market must prove it can hold its own, despite operating in a new stratosphere (above 2,135)," wrote Frank Cappelleri, technical analyst at Instinet LLC.

See:Here's why one bull thinks the S&P 500 can rally to 2,400 (http://www.marketwatch.com/story/heres-why-one-bull-thinks-the-sp-500-can-rally-to-2400-2016-07-22)

Earnings: In earnings, however, Monday is a busy day. Sprint Corp.(S) jumped 13% after the telecommunications company reported fiscal first-quarter revenue that beat expectations (http://www.marketwatch.com/story/sprints-stock-rallies-after-revenue-beat-net-phone-customer-additions-2016-07-25).

Shares of Micron Technology Inc. (MU) were up 6.5% after adopting a shareholder rights plan late on Friday.

Kimberly-Clark Corp.(KMB) fell 1.9% % even as the consumer-products company reported earnings avenue ahead of Wall Street expectations (http://www.marketwatch.com/story/kimberly-clark-reports-better-than-expected-q2-earnings-revenue-2016-07-25).

Gilead Sciences Inc.(GILD) and Express Scripts Holding Co.(ESRX) are slated to report after the market closes.

Movers and shakers:Verizon Communications Inc.(VZ) slipped 0.5% after confirming it has agreed to buy Yahoo Inc. for $4.83 billion (http://www.marketwatch.com/story/verizon-agrees-to-48-billion-deal-to-buy-yahoo-2016-07-24). Shares of Yahoo(YHOO) dropped 2.7% lower after being halted earlier in the morning news.

Read:Wall Street braces for feeding frenzy of earnings, central bank meetings (http://www.marketwatch.com/story/wall-street-braces-for-feeding-frenzy-of-earnings-central-bank-action-2016-07-23)

(http://www.marketwatch.com/story/wall-street-braces-for-feeding-frenzy-of-earnings-central-bank-action-2016-07-23)Amazon.com Inc.(AMZN) was off by 0.1% after Wedbush Securities lifted the price target on the stock to $835 from $775.

Other markets: Stocks in Asia closed mostly higher (http://www.marketwatch.com/story/hong-kong-stocks-retreat-after-entering-bull-market-territory-2016-07-24), while European markets also advanced for the most part (http://www.marketwatch.com/story/european-stocks-climb-for-first-day-in-three-as-ryanair-ericsson-advance-2016-07-25).

The dollar dropped against most rival currencies (http://www.marketwatch.com/story/dollar-steadies-as-investors-wait-for-fed-bank-of-japan-meetings-2016-07-25), with the ICE Dollar Index down 0.1% at 97.404. Oil futures dropped and gold and most other metals declined.

(END) Dow Jones Newswires

July 25, 2016 12:11 ET (16:11 GMT)

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