U.S. stocks fell on Monday as financials lagged, while a massive post-election rally eased, and investors kept an eye on surging oil prices ahead of a key OPEC meeting.
"I think the market is just taking a breather; investors are taking stock of where we've been," said Randy Warren, CIO at Warren Financial. "There's a lot of pessimism that the Trump rally is going to end, but I think there is no reason why it should."
The Dow Jones industrial average fell about 50 points, with Visa contributing the most losses. The S&P 500 closed about 0.5 percent lower, with financials falling around 1.4 percent. The Nasdaq composite fell about 0.6 percent. The Russell 2000, which is composed of small-cap stocks, closed about 1.3 percent lower, snapping a 15-day winning streak, its longest in 20 years.
"After three weeks of gains and a 15-day winning streak on the Russell 2000, we have to slow down," said Art Hogan, chief market strategist at Wunderlich Securities. "We got a perception that we're heading into a more pro-business administration."
The major U.S. equity indexes have also spiked since President-elect Donald Trump's surprising victory over Hillary Clinton, as investors' optimism for fiscal stimulus and tax cuts grew. Since the election, the Dow, S&P, Nasdaq and the Russell have staged a three-week winning streak, and have risen to new record highs.
Bruce Bittles, chief investment strategist at Baird, said in a Monday note that, "although the current rally has pushed stocks into an overbought condition, any weakness that could develop is expected to be limited since investors will be reluctant to take gains in December due to tax considerations."
In oil markets, West Texas Intermediate futures for January delivery rose 2.21 percent to settle at $47.08 per barrel after Dow Jones reported the Iraqi oil minister said Iraq will cooperate with other OPEC members to reach a deal.
Crude prices had traded lower earlier on Monday. after Libya's National Oil Corporation (NOC) said on Sunday it would not take part in any OPEC production cuts for the "foreseeable future," according to Reuters, and the Saudi Arabian Energy Minister Khalid al-Falih also said that he believed the oil market would balance itself next year even if producers did not intervene. OPEC is scheduled to hold a meeting Wednesday where it is expected to agree on an oil production cut or freeze.
"Although OPEC may be repeatedly commended on their ability to create speculative boosts in oil via freeze deal hopes this may come at a very heavy price if nothing is achieved on Wednesday," said Lukman Otunuga, research analyst at FXTM. "The classical prisoner's dilemma OPEC members face coupled with the persistent oversupply woes could ensure low oil prices remains a recurrent theme in the medium to longer term."
Oil prices, along with gold, also received a boost from the U.S. dollar, which paused Monday after rallying nearly 4 percent since the U.S. presidential election.
In economic news, the Dallas Fed manufacturing survey rose to 8.8 in November from 6.7 in October, with no other major data scheduled for release. That said, there is a slew of data scheduled for the rest of the week, which will culminate with the November jobs report release on Friday.
Investors have been keeping a close eye on U.S. economic data as the Fed is expected to raise interest rates at its December meeting. According to the CME Group's FedWatch tool, market expectations for a rate hike are above 95 percent.
In corporate news, Boeing is expected to be the target of new World Trade Organization sanctions, according to The Wall Street Journal. Meanwhile, Merck won priority review status from the Food and Drug Administration in its application for a new use for its cancer drug Keytruda. Investors also kept an eye on retail stocks following Black Friday last week.
U.S. Treasurys rose Monday, with the two-year note yield falling to 1.107 percent and the benchmark 10-year yield trading lower at 2.314 percent. The U.S. dollar fell 0.2 percent against a basket of currencies, with the euro near $1.061 and the yen around 101.3.
Overseas, European equities fell, with the Stoxx 600 Europe index dropping 0.77 percent. In Asia, stocks closed mixed, with the Nikkei 225 slipping 0.13 percent and the Shanghai composite advancing 0.46 percent.
The fell 11.63 points, or 0.53 percent, to close at 2,201.72, with financials leading seven sectors lower and utilities the biggest riser.
The Nasdaq composite dropped 30.11 points, or 0.56 percent, to end at 5,368.81.
About two stocks declined for every advancer at the New York Stock Exchange, with and exchange volume of 852.45 million and a composite volume of 3.428 billion at the close.
The CBOE Volatility Index (VIX), widely considered the best gauge of fear in the market, traded higher, near 13.2.
Gold futures for December delivery rose $12.40 to settle at $1,190.80 per ounce.
—CNBC's Sam Meredith and Peter Schacknow contributed to this report.
On tap this week:
Earnings: Shoe Carnival, ZTO Express, Thor Industries
8:30 a.m. Real GDP Q3 second
9:00 a.m. S&P/Case Shiller home prices
9:15 a.m. New York Fed President William Dudley
10:00 a.m. Consumer confidence
8:00 a.m. Dallas Fed President Rob Kaplan
8:15 a.m. ADP employment
8:30 a.m. Personal income
9:45 a.m. Chicago PMI
10:00 a.m. Pending home sales
12:35 p.m. Cleveland Fed President Loretta Mester
2:00 p.m. Beige book
Monthly vehicle sales
8:30 a.m. Initial claims
8:30 a.m. Cleveland Fed's Mester
9:00 a.m. Dallas Fed's Kaplan
9:45 a.m. Manufacturing PMI
10:00 a.m. ISM manufacturing
10:00 a.m. Construction spending
Earnings: Big Lots
8:30 a.m. Employment report
12:30 p.m. Fed Gov. Daniel Tarullo
12:30 p.m. Cleveland Fed's Mester