By Barbara Kollmeyer, MarketWatch , Ryan Vlastelica

All 11 S&P 500 sectors are down on the day

U.S. stocks fell on Monday, with investors finding few reasons to push shares higher into record territory following several straight weeks of gains and with concerns growing over whether the market's valuation was justified.

The Dow Jones Industrial Average fell 75 points, or 0.4%, to 20,931. The blue-chip average is coming off a string of records, as well as its fourth consecutive weekly gain.

The S&P 500 fell 13 points to 2,370, a decline of 0.6%. The benchmark is coming off a lengthy streak of its own, having advanced for six straight weeks. The Nasdaq Composite fell 38 points to 5,832, a decline of 0.7%.

Stocks have been on a tear of late, and last week the S&P 500 posted its biggest one-day advance since November. Recent gains have come on hopes that President Donald Trump would soon announce economic policies on taxes and regulation that would accelerate economic growth and boost corporate profits. Equities have rallied to repeated records on those hopes, but analysts say that details on these policies need to be released soon in order for investors to gauge whether the advance is justified by the legislation, especially given that valuations are, by some metrics, at multiyear highs (http://www.marketwatch.com/story/by-one-measure-stock-valuations-are-at-their-highest-level-since-2004-2017-02-17).

"We've seen a very large rally in the highest-risk components of the equity market since the election, and we're seeing a reversal of that trade today. The good news over fiscal policy got priced in very quickly, and the market is now trying to figure out what comes next," said Kevin Caron, portfolio manager at Stifel Nicolaus & Co.

The day's losses were broad, with all of the 11 primary S&P 500 sectors down on the day. Financials, by far the biggest postelection gainer, fell 1%, while materials lost 0.7%.

Federal Reserve policy has also been a driver of recent market action. Last week, Fed Chairwoman Janet Yellen and other key officials of the U.S.'s central bank boosted the market's growing expectations of a March interest-rate increase.

Over the medium term, pro-growth policy reforms from the current U.S. administration and "solid fundamentals" should keep equity values elevated, said Dubravko Lakos-Bujas, head of U.S. equity strategy at J.P. Morgan Chase & Co., in a note to clients published Monday.

"However, in the near-term we see increasing risk of a selloff due to more hawkish Fed rhetoric at a time when investor positioning is stretched and equity volatility is likely to rise from low levels," the strategist said. Lakos-Bujas added that he sees downside risk in the fact that hedge-fund exposure to equities is nearing record levels.

Read:Yellen's new objective: Moving interest rates to 'neutral' (http://www.marketwatch.com/story/yellens-new-objective-moving-interest-rates-to-neutral-2017-03-03)

Geopolitical issues were also in focus after North Korea fired four ballistic missiles into the waters (http://www.marketwatch.com/story/north-korea-tests-possible-icbm-south-korean-military-says-2017-03-05) off its east coast early Monday Seoul time. A Japanese government spokesman said three of those missiles had landed inside Japan's Exclusive Economic Zone, an area that extends from its coastline to about 230 miles out to sea.

While Wall Street showed little direct impact from the launch, the event was the latest source of political uncertainty for a market that has also grappled with populist movements in Europe (http://www.marketwatch.com/story/is-frexit-next-why-france-is-starting-to-really-freak-out-investors-2017-02-07) and President Trump's unsubstantiated claim (http://www.marketwatch.com/story/trump-accuses-obama-of-wiretapping-him-at-trump-tower-before-election-2017-03-04) that former President Barack Obama had initiated a plot to tap the phones at Trump Tower in the months leading up to Election Day.

Need to know:This 'most un-fun bubble ever' isn't like other bubbles--and there's comfort in that (http://www.marketwatch.com/story/this-most-un-fun-bubble-ever-isnt-like-other-bubbles-and-theres-comfort-in-that-2017-03-06)

Selloff chatter continues: Meanwhile, the market is approaching the eight anniversary of the Financial Crisis bottom. As the S&P 500 has more than tripled since that low, analysts and investors continue to debate whether equities are headed for a correction of sorts.

Read:This is the bull market's 8th birthday! No, wait. THIS is the anniversary (http://www.marketwatch.com/story/this-is-the-bull-markets-8th-birthday-no-wait-this-is-the-anniversary-2017-03-06)

(http://projects.marketwatch.com/2017/trump-today-signup/)

Interviews with more than a dozen money managers in the past week by the New York Times DealBook (https://www.nytimes.com/2017/03/05/business/dealbook/trump-stocks.html?hp&action=click&pgtype=Homepage&clickSource=story-heading&module=first-column-region&region=top-news&WT.nav=top-news&_r=0), found that nine of them expect at least a modest decline for stocks in the near future.

See:

Read:There's a low bar on jobs growth for Fed to hike rates (http://www.marketwatch.com/story/theres-a-low-bar-on-jobs-growth-for-fed-to-hike-rates-2017-03-05)

Stocks to watch: Shares of General Motors Co. (GM) fell 2.1% after the auto maker said it would sell its unprofitable European unit, including Opel and Vauxhall, in a $2.3 billion deal (http://www.marketwatch.com/story/after-20-unprofitable-years-general-motors-to-shed-european-unit-opel-in-23-billion-deal-2017-03-06). (http://www.marketwatch.com/story/after-20-unprofitable-years-general-motors-to-shed-european-unit-opel-in-23-billion-deal-2017-03-06) GM said it would take a related accounting charge of $4 billion to $4.5 billion.

(http://www.marketwatch.com/story/after-20-unprofitable-years-general-motors-to-shed-european-unit-opel-in-23-billion-deal-2017-03-06)Deutsche Bank AG (DBK.XE) (DBK.XE) U. S-listed shares fell 3.7% on news of an 8 billion euro ($8.5 billion) rights issue (http://www.marketwatch.com/story/deutsche-bank-shares-dive-as-it-plans-rights-issue-2017-03-06).

The first case of avian influenza, or bird flu, to strike a commercial poultry flock in more than a year was discovered on a Tennessee chicken farm affiliated with Tyson Foods Inc. (TSN), government and company officials confirmed Sunday (http://www.marketwatch.com/story/bird-flu-discovered-at-tennessee-chicken-facility-usda-says-no-risk-to-consumers-2017-03-05). The U.S. Department of Agriculture said there is no risk to consumers. Shares of Tyson lost 3.2%.

Other markets:European stock markets (http://www.marketwatch.com/story/deutsche-banks-slide-pulls-financials-german-dax-lower-2017-03-06) were lower, led by losses for the German DAX index as Deutsche Bank tumbled. In Asia , markets largely shrugged off North Korea's missiles tests, with the Nikkei 225 index (http://www.marketwatch.com/story/japan-south-korea-markets-muted-after-north-korean-missile-tests-2017-03-05) slipping 0.5%, and South Korea's Kospi finishing up 0.1%.

The Shanghai Composite Index gained 0.5% after Chinese Premier Li Keqiang said the country's GDP growth target for the year would be "around" 6.5%, versus the stated 2016 goal of between 6.5% and 7%.

The yen did gain some strength on Monday (http://www.marketwatch.com/story/dollar-pulls-back-as-geopolitics-rattle-the-markets-2017-03-06), with the dollar dropping to Yen113.79 from Yen113.93 late Friday in New York. Gold rose less than 0.1% to $1,227.30 an ounce.

Oil prices (http://www.marketwatch.com/story/oil-prices-weaken-further-after-high-oil-rig-count-2017-03-06) were under pressure after Friday's data from Baker Hughes Inc. (BHI) showed another rise in the U.S. rig count.

(END) Dow Jones Newswires

March 06, 2017 12:21 ET (17:21 GMT)

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