U.S. stocks closed mixed in below average trade volume Monday, with gains in health care offsetting declines in materials and energy as oil prices fell. (Tweet This)
"It seems like there's a lot of rotation going on into the safe havens," said Robert Pavlik, chief market strategist at Boston Private Wealth. "I think there's concern about the strength of the economy, the overall lag of the rally that's been occurring in oil. There's concerns about China as well. The dollar is stronger as well. That's certainly not helping the commodity space."
U.S. crude oil futures settled down $1.22, or 2.73 percent, at $43.44 a barrel. Materials closed 1.25 percent lower, while energy ended 1.24 percent lower.
Health care closed more than 1 percent higher to lead advancers, followed by utilities and consumer staples. The iShares Nasdaq Biotechnology ETF (IBB) closed nearly 2.6 percent higher for its best day since April 21.
Mike Bailey, director of research and chair at FBB Capital Partners, attributed the gains in the health care sector to better investor sentiment with "not a new major negative in the group, and some mild positives."
Mallinckrodt closed 6.12 percent higher and Allergan closed up nearly 6 percent to lead health care advancers.
Amazon.com, Celgene and Amgen had the greatest positive impact on the Nasdaq 100.
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The Dow Jones industrial average underperformed, closing about 35 points lower with Caterpillar and Chevron contributing the most to declines. Johnson & Johnson contributed the most to gains.
"The market's just really in search of a signal right now and there's no (U.S.) economic data to provide it," said Mark Luschini, chief investment strategist at Janney Montgomery Scott.
Trade volume across the exchanges was below average, at about 6.75 billion shares, according to FactSet data.
LendingClub topped active and unusual volume activity with nearly 15 times its 30-day average volume of 6.5 million shares. The stock plunged nearly 35 percent after the company said co-founder Renaud Laplanche had resigned as chairman and CEO.
The U.S. dollar index rose nearly 0.3 percent, after hitting its highest since April 28, for its first five-day win streak since the one ended March 24. The euro was last near $1.138 and the yen at 108.39 yen against the greenback.
"I think the big news today to me is dollar-yen. Dollar-yen really starting to squeeze the shorts out," said Jeremy Klein, chief market strategist at FBN Securities.
Japanese Finance Minister Taro Aso said Monday in a Reuters report that Tokyo is ready to intervene in the currency market if yen moves are volatile enough to hurt the country's trade and economy.
Treasury yields held lower, although above lows touched Friday. The was near 0.71 percent after falling to 0.686 percent, its lowest since February 12, on Friday. The 10-year yield held near 1.75 percent.
"The strong dollar and EM selling off, oil lower, somewhat risk-off or deflationary tone today," said Eric Stein, co-director of global fixed income at Eaton Vance Management. But longer-term, he said "inflation expectations will come back up."
The iShares MSCI Emerging Markets ETF (EEM) closed nearly 1.3 percent lower. The ETF is more than 5 percent lower for the quarter so far, but still up about 0.7 percent year-to-date.
Earlier, oil rose amid news of declines in daily production capacity from Canada's most destructive wildfire in recent memory. Reuters said the lost capacity of about a million barrels equals more than a third of the country's typical daily production, and nearly all of Canada's crude from oil sands is exported to the United States.
"The crosscurrents are playing in a commodities market that's had a significant lift," said Art Hogan, chief market strategist at Wunderlich Securities.
On Saturday, crude exporter Saudi Arabia appointed Khalid al-Falih, chairman of the state oil giant Saudi Aramco, as its new energy minister, replacing Ali al-Naimi, who had held the post since 1995.
China's crude oil imports rose 7.6 percent in April from a year ago, according to customs data released Sunday, Reuters said. The demand was driven by strong demand from domestic private refiners, many of which received licenses from Beijing last year to import crude for the first time.
Overall, China reported 10.9 percent decline in imports and a 1.8 percent drop in exports from the same period last year.
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China's foreign exchange reserves rose for a second-straight month to $3.22 trillion in April, central bank data showed on Saturday.
Asian stocks closed mixed, with the Hang Seng and Nikkei 225 slightly higher and the Shanghai composite about 2.8 percent lower.
European stocks closed higher, with the German DAX outperforming with gains of more than 1 percent.
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Chicago Fed President Charles Evans said in a Reuters report Monday solid U.S. economic fundamentals should support pickup in growth this year to about 2.5 percent, but the Fed's current "wait-and-see" approach to monetary policy is appropriate.
Minneapolis Fed President Neel Kashkari said Monday the central bank's current monetary policy stance is appropriate, Reuters reported, citing prepared remarks. He said in the report that low rates help bring workers back to the labor force without putting too much upward pressure on inflation, although that pressure could build if rates are kept low for too long.
Earlier, in an interview with Reuters the current stance of monetary policy is "about right."
San Francisco Fed President John Williams is due to speak early in the evening ET.
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On Friday, the April nonfarm payrolls report showed creation of 160,000 jobs, below expectations. The labor force participation rate fell to 62.8 percent.
New York Fed President William C. Dudley said in a New York Times article Friday the jobs report was perhaps softer than expectations but gave it little weight in affecting his economic outlook. He added in the piece that two hikes this year remained a "reasonable expectation."
U.S. stocks closed higher Friday, amid gains in oil prices.
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Major U.S. Indexes
The Dow Jones industrial average closed down 34.72 points, or 0.20 percent, at 17,705.91, with Caterpillar leading decliners and Wal-Mart the greatest advancer.
The closed up 1.55 points, or 0.08 percent, at 2,058.69, with health care leading five sectors higher and materials the greatest decliner.
The Nasdaq composite closed up 14.05 points, or 0.30 percent, at 4,750.21.
The CBOE Volatility Index (VIX), widely considered the best gauge of fear in the market, traded lower near 14.5.
About eight stocks declined for every seven advancers on the New York Stock Exchange, with an exchange volume of 946 million and a composite volume of 3.7 billion in the close.
Gold futures for June delivery settled down $27.40 at $1,266.60 an ounce, its worst day since Feb. 16.
—Reuters contributed to this report.
On tap this week:
Monday
Earnings: Hertz Global, Intl. Flavors & Fragrances, Rackspace, SolarCity
6 p.m. San Francisco Fed President John Williams
Tuesday
Earnings: Credit Suisse, Nokia, Norwegian Cruise Line, Crocs, Dean Foods, Lumber Liquidators, Disney, Electronic Arts, Jazz Pharma, Nuance Comm., Sun Life Financial, Blue Buffalo, Fogo de Chao, Planet Fitness
3:15 a.m. New York Fed President William Dudley
6 a.m. NFIB survey
10 a.m. Wholesale trade
10 a.m. JOLTS
1 p.m. $24 billion three-year note auction
Wednesday
Earnings: Allianz, Nissan, Toyota Motors, Macy's, Wendy's, CA, NetEase
1 p.m. $23 billion 10-year note auction
2 p.m. Federal budget
Thursday
Earnings: Dr. Reddy's Labs, Kohl's, Ralph Lauren, Nordstrom, Nvidia, Symantec, Shake Shack
8:30 a.m. Initial claims; import prices
11 a.m. Cleveland Fed President Loretta Mester
11:45 a.m. Boston Fed President Eric Rosengren
1 p.m. $15 billion 30-year bond auction
2:15 p.m. Kansas City Fed President Esther George
Friday
Earnings: Honda Motor, Brookfield Asset Mgmt., JC Penney
8:30 a.m. Retail sales
8:30 a.m. PPI
10 a.m. Consumer sentiment
10 a.m. Business inventories
6:25 p.m. San Francisco Fed's Williams
*Planner subject to change.
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CORRECTION: Trading volume was below average Monday at about 6.75 billion shares. FactSet provided incorrect figures for an earlier version of this article.