U.S. stocks fell on Monday as the ongoing crisis in Ukraine weighed on sentiment and pushed investors to take profits in some of the market's biggest trading favorites.
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"Momentum names are getting smacked," said Todd Salamone, director of research at Schaeffer's Investment Research. "With many equity benchmarks coming into the week around the highs from earlier this month, it could be profit-takers seeking to lock in some gains ahead of the quarter's end later this week."
Futures had been higher throughout the premarket session, lifted by hopes that China would take stimulative measures to support its economy, but indexes turned lower early, with the Nasdaq especially hit hard as Netflix and Tesla tumbled.
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"These are all stocks that have had enormous gains over the last year; those are high-valuation stocks, and when you talk about a risk-off trade where people are withdrawing capital from riskier areas, that where people pull from first, stocks that have had significant run ups," said Matthew Kaufler, portfolio manager at Federated Investors of companies including Tesla Motors and Netflix.
Netflix was the S&P's biggest percentage gainer in 2013, while Tesla soared 344 percent last year and extended that rally by more than 40 percent so far this year.
Tesla was down nearly 6 percent at around $215, while Netflix was off almost 7 percent at $377.
"Once stocks like these stumble, they fall really hard," said Kim Forrest, senior equity research analyst, Fort Pitt Capital Group in Pittsburgh. "Everyone loves them on the way up, but no one does on the way down."
The NYSE Arca Biotech Index was trading well over 3 percent, adding to its 4-percent drop last Friday. The index is seeing its worst two-day losing streak since August 2011. m
Losses were limited in the Dow by a rise in Procter & Gamble Co, a consumer staple that is considered a defensive play. That stock rose 2 percent to $79.42, snapping a four-day losing streak.
Ukraine announced the evacuation of its troops from Crimea, essentially yielding the region to Russian forces, which earlier seized a Ukrainian marine base there. While few U.S. companies have excessive exposure to the region, investors are concerned about the potential economic fallout from any escalation in tensions.
U.S. President Barack Obama, who has imposed personal sanctions against some of Russian President Vladimir Putin's political and business allies, began crisis talks with his European allies over how to respond in the biggest East-West conflict since the Cold War.
"The issue remains contained for the time being, but Obama will try and garner support for more sanctions, which will ultimately shape our view of how things can end up looking," said Art Hogan, chief market strategist at Wunderlich Securities in New York. "This remains at the forefront of what we're paying attention to."
—CNBC.com Staff contributed to this report.