Stocks came off their worst levels but still closed lower Monday as investors took a breather following the recent market rally and amid ongoing debt negotiations in Greece over a fresh austerity package.
The Dow Jones Industrial Average declined 17.10 points, or 0.13 percent, to finish at 12,845.13, led by Travelers and Pfizer .
The S&P 500 slipped 0.57 points, or 0.04 percent, to close at 1,344.33. The Nasdaq edged down 3.67 points, or 0.13 percent, to end at 2,901.99. Interestingly, the S&P has ended down 4 of the last 5 Mondays following the Super Bowl.
The CBOE Volatility Index, widely considered the best gauge of fear in the market, ended near 18.
Most S&P sectors closed lower, led by materials and financials, while energy edged higher.
Greece failed to meet another deadlineMonday to strike a deal to secure the 130 billion euro ($170 billion) rescue, pushing the debt-ridden nation closer to a default, which could threaten other euro zone nations.
German Chancellor Angela Merkel stepped up pressure on Greece, warning that time was running short. (Read More: Greek Default—Why Now May Be the Best Time to Just Do It)
“The geopolitical world is an absolute stew of troubles,” said Art Cashin, director of floor operations at UBS Financial Services. “Egypt is beginning to unwind a little bit again, [there are also concerns over] Iran and Israel…you’ve got a lot of things out there to worry about beside whether you’re going to make your earnings target.”
Medco plunged to lead the S&P 500 laggards amid growing objections to the proposed buyout by Express Scripts as regulators weighed whether or not to stop the $29 billion deal. Meanwhile, Walgreen rallied following the news.
Boeing declined after the Dow component discovered a manufacturing problem that will require repairsin the fuselage section of some 787 Dreamliners.
General Motors aims to raise its profit margin to 10 percent over the next few years, up from the current margin of about 6 percent, said Daniel Ammann, according to a report.
Among earnings, Hasbro posted earnings that edged above estimates. This comes after the toymaker last month expected lower-than-expected sales for the holiday quarter, citing weak post-Thanksgiving demand in North America.
Humana posted earnings that were in line with estimates. Still, the health insurer tumbled after firm reported revenue below expectations and failed to raise its full-year forecast up to Wall Street estimates.
Sohu.com tanked more than 15 percent after the Chinese Internet company forecast first-quarter results below estimates.
“Our [earnings] beat rate is very low at this point…unfortunately, as we look forward to the first half of 2012, those numbers will continue to come down a bit,” said Christine Short, senior manager at S&P Capital IQ. “Overall, 2012 is expected to be up only about 6 percent, which is a respectable number, but companies and their guidance are saying they are expecting weakness in the first half of the year.”
Yum Brands is slated to post earnings after-the-bell tonight.
Toll Brothers , Lennar and D.R. Horton declined even after Citigroup raised its price target on a handful of homebuilders.
Facebook plans to start showing advertisements to users on mobile devices in an effort to find a new source of revenue ahead of its heavily-anticipated IPO, according to the FT. The report also said that Glencore will pay an 8 percent premium to seal its merger with Xstrata, more than initially expected.
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Coming Up This Week:
TUESDAY: 3-yr note auction, consumer credit; Earnings from BP, Coca-Cola, Toyota, UBS, Disney, Hartford Financial, Panera Bread
WEDNESDAY: Mortgage applications, oil inventories, Fed's Williams speaks, 10-yr note auction; Earnings from Sanofi, CVS Caremark, Sprint Nextel, Time Warner, Cisco, Groupon, Visa, WholeFoods
THURSDAY: BoE announcement, ECB announcement, jobless claims, wholesale trade, 30-yr bond auction; Earnings from PepsiCo, Rio Tinto, Vodafone, Credit Suisse, Sirius XM Radio, Dunkin' Brands, Petrobras, Activision Blizzard, Expedia, LinkedIn
FRIDAY: International trade, consumer sentiment; Earnings from Barclays
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