The Dow Jones Industrial Average fell on Monday as Wall Street digested strong gains from the previous week and looked ahead to the start of the corporate earnings season.
"Equity trends remain steadfastly bullish but are now getting stretched, and have arrived at near-term areas where resistance could set in," said Mark Newton, managing member at Newton Advisors. "Momentum is nearing overbought territory yet again after one of the best quarters in over 20 years time, while the groups that have led this rally, namely technology, consumer discretionary and industrials, are now up to levels near prior highs which are thought to be important from a price perspective."
Shares of Boeing and General Electric led the decline. Boeing dropped more than 4% after Bank of America Merrill Lynch cut its rating on the aerospace giant to neutral from buy. The bank said it expects production of the 737 Max jet to be delayed by six to nine months. This follows a deadly plane crash from last month that involved a 737 Max plane.
GE, meanwhile, fell more than 5% after J.P. Morgan downgraded the stock, noting: "We believe many investors are underestimating the severity of the challenges and underlying risks at GE, while overestimating the value of small positives."