By Kate Gibson, MarketWatch
NEW YORK (MarketWatch) -- U.S. stocks fell on Monday as Wall
Street extended a much-anticipated pullback that coincided with the
March payrolls report and other disappointing economic data.
After rising to a record closing high of 1,570.25 a week ago,
the S&P 500 index (SPX) declined 1% last week following the
smallest increase in jobs in nine months and other reports on
manufacturing and services also came in below expectations.
The jobs report prompted worries the U.S. economy had hit a soft
patch. Breaking down the jobs report
That said, the S&P 500 remains nearly 9% higher for the
year, with corporate profit and the Federal Reserve's ongoing
bond-buying program helping support equities.
"It's still a bad-news, good-news market where modestly poor
economic data keeps the Fed engaged," said Paul Nolte, managing
director at Dearborn Partners in Chicago.
"We're still within a few percentage points of all-time highs.
Along the lines of Mark Twain, I think the death of this market has
been greatly exaggerated," Nolte said. "A little bit of a pullback
is not a bad thing and has been expected for a while."
Fed Chairman Ben Bernanke is scheduled to give a speech after
Monday's close, with investors looking for any clues as to how long
the central bank would continue its monetary easing.
The Dow Jones Industrial Average (DJI) fell 42.51 points, or
0.3%, to 14,522.74, with 17 of its 30 components in the red, led by
pharmaceutical giant Johnson & Johnson (JNJ) , off 1.6%
following a downgrade to neutral from overweight at J.P.
Morgan.
Alcoa Inc. (AA) becomes the first member of the Dow Jones
Industrial Average to release results for the first quarter when
the aluminum producer reports after Monday's close.
While Alcoa's results mark the unofficial start of the earnings
season, analysts cautioned against reading too much into its
report.
"Do not get caught up in the hype of Alcoa being a good proxy
for the upcoming earnings season because it is not and certainly
its stock price has not reflected it either," said Nick Raich,
chief executive officer at The Earnings Scout.
Shares of Alcoa have been languishing over the past 18 months,
and analysts aren't too hopeful the first-quarter report will help
much.
On Monday, the S&P 500 index declined almost more than 1
point to 1,551.83, with telecommunications down the most and
consumer-related companies faring best among its 10 major
sectors.
BioCryst Pharmaceuticals Inc. (BCRX) shares leapt 15% after
China speed up the approval of its anti-influenza drug Peramivir.
Lufkin Industries Inc. (LUFK) rose almost 38% after the General
Electric Co. (GE) said it would acquire the manufacturer of
oil-well pumps for about $3.3 billion, or $88.50 a share.
The Nasdaq Composite (RIXF) lost 4.41 points, or 0.1%, to
3,199.42.
Advancers pulled just ahead of cecliners on the New York Stock
Exchange, were 238 million shares traded as of 1 p.m. Eastern.
Composite volume neared 1.4 billion.
The biggest earnings of the week will come from J.P. Morgan
Chase & Co. (JPM) and Wells Fargo & Co. (WFC), which both
report on Friday. Analysts said while the forecast for earnings is
one of the weakest in a while, the consensus still may be too high.
Read: Earnings are first big stock test since market high
Oil prices were rebounding from last week's loss of nearly 5%,
with benchmark oil for May delivery (CLK3) lately up 26 cents at
$92.96 a barrel on the New York Mercantile Exchange.
The U.S. dollar (DXY) gained against other currencies including
the yen (USDJPY) . Treasury prices were mixed, with the yield on
the 10-year note (10_YEAR) lately at 1.718%.
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