U.S. equities closed mixed in choppy trade on Monday, the first day of the month, amid falling oil prices while investors digested economic data.
The Dow Jones industrial average closed 27 points lower, erasing earlier gains, with Chevron and ExxonMobil contributing the most losses. The blue-chips index also extended its losing streak to six days. At its session lows, the Dow traded 76.49 points lower. The S&P 500 traded about 0.13 percent lower, with energy falling more than 3 percent. Earlier, the benchmark index hit a new all-time intraday high.
"You've almost got a tale of two markets," said Art Hogan, chief market strategist at Wunderlich Securities. "Part of that is getting used to the new normal in energy prices." "You've got tech names like Apple and biotech helping the Nasdaq."
The Nasdaq composite ended 0.4 percent higher, well off session highs, with Apple and as the iShares Nasdaq Biotechnology ETF both rising more than 1.5 percent.
"We've had a breakdown in the correlation between oil and the market since we broke above $40," said Randy Frederick, managing director of trading and derivatives. "If we break below $40, that could be a problem."
U.S. crude has fallen from about $46.50 a barrel to its current levels in just ten days, according to FactSet.
"To go from $50 to $40 is essentially a bear market," said Jack Ablin, chief investment officer at BMO Private Bank.
On the data front, the ISM manufacturing index came in at 52.6, slightly below Reuters' estimate of 53. Any number above 50 indicates expansion. The Markit PMI manufacturing index reading for July came in at 52.9. Construction spending for June declined 0.6 percent.
Kim Forrest, senior equity analyst at Fort Pitt Capital, said "I think the economic news was spot on. There' a little disappointment in construction spending, but it's tough for that kind of month-to-month data, since it factors in weather" and other elements.
"Bottom line, notwithstanding the slight decline [month over month], manufacturing in the US has stabilized with the ISM index above 50 for the 5th straight month and a touch above the 6 month average of 51.5," Peter Boockvar, chief market analyst at The Lindsey Group, said in a note to clients.