The S&P 500 slid 0.2%, coming off a sixth consecutive winning week, the DJIA dropped 344 points, or 0.8%, from its own record that was likewise set on Friday, while the Nasdaq composite gained 0.3%
U.S. stocks dropped from their all-time highs Monday as some of the steam came out of Wall Street’s long, record-breaking rally.
The S&P 500 slid 0.2%, coming off a sixth consecutive winning week, its longest such streak of the year. The DJIA dropped 344 points, or 0.8%, from its own record that was likewise set on Friday, while the Nasdaq composite gained 0.3%.
Trading was mixed in markets around the world. Crude oil prices gained to recover some of last week’s sharp losses, while U.S. Treasury yields jumped and stock indexes mostly declined in Europe after closing mixed in Asia.
The rise in yields helped knock down stocks that tend to get hurt by higher interest rates, such as big dividend payers and businesses in the housing industry. Real-estate stocks fell to the sharpest loss among the 11 sectors that make up the S&P 500 index, while homebuilders Lennar and D.R. Horton both slipped at least 4.3%. Home Depot’s 2.1% tumble was one of the heaviest weights on the S&P 500.
The declines mean at least a pause in Wall Street’s rally to records, which was built in large part on optimism that the U.S. economy can make a perfect escape from the worst inflation in generations, one that ends without a painful recession that many investors had worried could be inevitable. With the Fed now cutting interest rates to keep the economy going, the expectation among optimists is that stocks can gain even further.
But critics are warning that stock prices look too expensive given how much faster they’ve jumped than corporate profits.