U.S. stocks on Monday declined for a third session, pulling the S&P 500 into the red for the year, as investors shed high-profile assets that fared well in 2013 in search of better values.
"Investors are moving out of many areas of the market that performed well last year. In particular, the Internet, social media and biotechnology industries are experiencing some notable weakness," Russ Koesterich, BlackRock's global chief investment strategist, wrote in afternoon commentary.
"The momentum meltdown continues to be the story," said Art Hogan, chief market strategist at Wunderelich Securities, referring to the bashing of Internet names, which on Monday included Amazon.com, Priceline Group, Google and Apple.
"Investors are rotating out of the higher beta stocks, if you will, to utilities and other quote, unquote, safe stocks," said Paul Nolte, senior vice president, portfolio manager at Kingsview Asset Management.
"Those things that did poorly last year are doing fine; those things that did fine last year are doing poorly. I don't read anything more into it than a rotation into safer areas," Nolte added.
The unofficial start of the quarterly earnings season begins after Tuesday's close, with aluminum producer Alcoa slated to release earnings. Banks JPMorgan Chase and Wells Fargo also report this week, along with retailer Bed, Bath & Beyond.
"In recent weeks a near-record number of S&P 500 firms have issued negative guidance with some blaming the weather and some blaming the strong dollar," David Kelly, chief global strategist at J.P. Morgan Funds, wrote in emailed research.
"However, the correlation between guidance and results does not appear stable," Kelly added.