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Stocks Snap 4-Day Win Streak; Oil Drops 3%

Stocks snapped a four-day rally Monday, pulling back from Fed-fueled multi-year highs, amid fresh geopolitical worries and following a drop in oil prices.

Apple crossed $700 a share in after-hours trading after closing at a new all-time high after the tech giant said iPhone 5 sales set a record over the weekend. Meanwhile, BMO raised its price target to $750 from $680 on the iPhone maker. (Read More: iPhone 5 Could Be a Boost for China)

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S&P 500
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The Dow Jones Industrial Average declined 40.27 points, or 0.30 percent, to end at 13,553.10, led by BofA and Alcoa .

The S&P 500 erased 4.58 points, or 0.31 percent, to close at 1,461.19. The Nasdaq slipped 5.28 points, or 0.17 percent, to finish at 3,178.67.

The CBOE Volatility Index, widely considered the best gauge of fear in the market, gained near 15.

Despite the day's pullback, all three major averages are still up more than 3 percent for the month.

Among the key S&P sectors, materials led the laggards, while health care ended higher.

Stocks took another leg lower around 2pm ET as oil briefly plunged $4 to below $95 a barrel. Some traders passed around rumors about a "fat-finger" trading error, while others buzzed about a potential release from the Strategic Petroleum Reserve.

But the CME Group said it is "unaware of any technical issues" regarding the crude price drop and the White House said there are no immediate plans to make changes to the SPR.

“We’ve had back-to-back terrific weeks with the markets reacting to positive news positively and ignoring negative news—so we’re taking a breather,” said Art Hogan, managing director of Lazard Capital Markets. “Still, this is not the beginning of a pullback—the Bernanke put is going to be here for a while, which will limit some downside risk.”

Stocks logged a four-day rally last Friday and posted sharp gains for the second-straight week as investors cheered the Federal Reserve’s decision to embark on another round of monetary stimulus. (Read More: How Fed's 'Shock and Awe' Will Affect Investors—O'Neill)

“We’re likely to see a 7 to 8 percent pullback in the next six weeks,” said Yu-Dee Chang, chief trader at ACE Investment Strategists. “There are still a lot of uncertainties ahead, but by the middle of November, I see another wave up.”

Netflix slumped to lead the S&P 500 laggards after Macquaire initiated coverage of the online movie streaming company at "underperform."

Materials were the biggest laggards after JPMorgan downgraded AK Steel , U.S. Steel , CliffNatural Resources , and others to "neutral" from "overweight."

Tyco International declined after shareholders approved a breakupof the industrial conglomerate into three parts.

On the M&A front, IRIS International surged after Danaher said it will acquire the diagnostics company in a deal worth $355 million.

And waste services company Waste Connections jumped after the company said it is buying R360 Environmental Solutions for about $1.3 billion.

On the economic front, factory activity in New York state dropped to its lowest level in nearly 3-1/2 years, according to the New York Federal Reserve.

European shares ended lower as fears about the euro zone’s debt-ridden peripheral nations resurfaced with thousands protesting in Spain and Portugal austerity measures.

Japanese companies such as Toyota and Honda were under pressure as anti-Japan demonstrations in China intensified, leading to some factory shutdowns. The protests were sparked by disputes over islands in the East China Sea.

By CNBC’s JeeYeon Park (Follow JeeYeon on Twitter: @JeeYeonParkCNBC)

Coming Up This Week:

TUESDAY: Fed's Evans speaks, current account, Treasury int'l capital, housing market index, Fed's Lacker speaks, Ford Fusion launch; Earnings from FedEx
WEDNESDAY: Weekly mortgage apps, housing starts, existing home sales, oil inventories; Earnings from AutoZone, General Mills, Adobe Systems, Bed Bath & Beyond
THURSDAY: Jobless claims, Philadelphia Fed survey, leading indicators, Fed's Kocherlakota speaks; Earnings from CarMax, ConAgra, Rite Aid, Oracle
FRIDAY: Quadruple witching, Fed's Lockhart speaks, iPhone 5 shipping date

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