By Kate Gibson, MarketWatch
NEW YORK (MarketWatch) -- U.S. stocks dropped on Monday after
last week's record high for the Dow Jones Industrial Average and as
data showed a slowdown in the growth of Chinese industrial
output.
The Dow industrials (DJI) fell 3.34 points to 14,3393.73.
The S&P 500 index (SPX) slipped almost 2 points, or 0.1%, to
1,549.33, with telecommunications and technology hardest hit and
health care and financials the stronger performers among its 10
sectors.
The Nasdaq Composite (RIXF) lost 7.94 points, or 0.2%, to
3,236.44.
With no U.S. economic data due on Monday, investors considered
Chinese reports. China's consumer inflation jumped to 3.2%
year-on-year in February, up from 2% in January for the largest
rise since April 2012. Part of the rise likely came from the Lunar
New Year holiday, which often produces a spike in prices for food
and other goods. Other data showed industrial product grew more
slowly in January and February. Read: China's inflation climbs;
other indicators soften.
"China's industrial production and consumer spending slowed and
fell below estimates during February," Fred Dickson, chief
investment strategist at Davidson Companies, wrote in emailed
research.
"China's inflation rose to a 10-month high. The data suggest a
dilemma for China's new government leaders as they indicated a
month ago their intention to stimulate their economy when inflation
was not a worry," he said. "The U.S. stock market rally is extended
and ripe for a minor profit-taking pullback," Dickson added.
Last week, the Dow set a string of record closing highs, while
the S&P 500 Index ended Friday at 1,551.18, just 14 points from
its record. See: Stocks up for week; S&P 500 near record.
Money continues to flow into exchange-traded products that track
the S&P 500, a sign retail investors may be regaining
confidence. See: Investors flock to S&P 500 ETFs as record
beckons.
For every three stocks rising four fell on the New York Stock
Exchange on Monday, where 126 million shares traded as of 10:40
a.m. Eastern. Composite volume reached 651 million.
Intrade halted trading, with the Irish online betting service
saying it is looking into possible financial irregularities.
In corporate news, Icahn Enterprises LP (IEP) said it signed a
confidentiality pact with Dell Inc. (DELL), less than a week after
investor Carl Icahn joined those opposed to co-founder Michael
Dell's plan to take the personal-computer maker private. Shares of
Dell gained 1% in early trade. Read: Icahn's firm signs
confidentiality pact with Dell.
Shares of Genworth Financial Inc. (GNW) jumped 6.9% after
Barron's reported the recently reorganized life insurer and
provider of mortgage securities could nearly double in the next
year.
Dick's Sporting Goods Inc. (DKS) fell 7.1% after the retailer
projected profit below expectations.
Best Buy Co. (BBY) gained 0.6% after an upgrade by Piper
Jaffray. Kroger Co. (KR) shed 1% and Apple Inc. (AAPL) declined
1.3% after analyst downgrades.
European stocks traded lower. Ratings firm Fitch late Friday cut
Italy's credit rating one notch to BBB-plus, citing uncertainty in
the wake of last month's inconclusive parliamentary elections. See:
Italian bond yields edge higher after downgrade.
After much stronger-than-expected labor-market data on Friday,
February retail-sales figures are scheduled this week. See:
Consumers hold key to higher job growth.
Rival retailers and groups representing publishers and writers
have joined to oppose Amazon.com Inc.'s (AMZN) request to control
certain Web domains, including .author, .book and .read. See:
Amazon aim to conttol some domains is opposed: WSJ.
Clothing retailer Urban Outfitters Inc. (URBN) is expected to
report fourth-quarter earnings of 57 cents a share on sales of
$850.5 million, according to analysts polled by FactSet.
Subscribe to WSJ: http://online.wsj.com?mod=djnwires