Euro zone finance ministers meet on Mondayamid renewed worries about Greek sovereign debt. Ministers were expected to approve a bailout package for Portugal and to pressure Greece to announce further austerity measures in return for additional emergency funding.
Strauss-Kahn’s arrest leaves little prospect of him returning to the helm of the IMF soon, and has also derailed his possible French election campaign.
The euro zone's troubles pressured oil pricesas well. U.S. light, sweet crude fell below $100 a barrel, while in London, Brentcrude fell below $114 a barrel.
In the U.S., NYSE Euronext fell about 10 percent on news Nasdaq OMX Group and IntercontinentalExchange were withdrawing their bid for the exchange after it became clear the U.S. Department of Justice wouldn't approve the deal.
Also on the M&A front, DuPontwon its takeover battlefor Danisco as shareholders owning 92.2 percent of the company accepted the chemical maker's $6.4 billion offer for the Danish food products firm. The acquisition is part of DuPont's push into food technology.
Joy Global, a drilling manufacturer, gained after news it would buy LeTourneau Technologies, an equipment manufacturing unit owned by Rowan . The acquisition will give Joy Global access to the oil and gas drilling market.
And SanDisk jumped after news it would buy enterprise solid-state drive technology firm Pliant Technology for $327 million.
In earnings news, Lowe's sank after disappointing profit results, blaming cold weather and rain for keeping shoppers away. Shares of rival Home Depot , which reports earnings Tuesday before the market opens, rose slightly.
But JCPenney's gained after delivering better-than-expected results.
Urban Outfitters releases earnings results after the market closes, while Wal-Mart and TJX will also deliver earnings before the market opens on Tuesday.
Elsewhere in stocks news, airlines stocks got a boost from JPMorgan, which says airliners will benefit from falling prices for jet fuel. The brokerage upgraded AMRand JetBlue Airways to "overweight" from "neutral." AMR's price target was raise dto $9.50 a share from $8.50 and JetBlue's was raised to $8 from $7.
And Ford gained after Citigroup upgraded the automaker to "buy," citing valuation. The brokerage cut auto supplier Magna International , however, to "hold" from "buy," citing its current preference for automakers.
In U.S. economic news, the NAHB/Wells Fargo Housing Market indexremained steady at 16, according to the National Association of Home Builders. Economists surveyed by Reuters had expected the index to inch higher, to 17.
More news on housing comes later this week when data on housing starts are released on Tuesday and on existing homes sales are released on Wednesday.
TheEmpire State Manufacturing Indexfell to 11.88 in May from 21.7 in April, the lowest level since December 2010, the New York Federal Reserve reported. The prices paid component of the index, meanwhile, rose sharply to 69.89 from 57.69, the highest since July 2008.
And the $14.3 trillion debt limitwas expected to be reached on Monday. The White House and congressional Republicans have not been able to strike a deal over the deficit and the debt ceiling. President Barack Obama has warned that that a failure to raise the debt limit could lead to a worse financial crisis than the one in 2008-09, Reuters reported.
On Tap This Week:
MONDAY: Treasury international capital, housing market index, 13-F filings due.
TUESDAY: Housing starts, industrial production, JPMorgan shareholder meeting, Shell Oil annual meeting; earnings from Home Depot, Wal-Mart, TJX and Dell.
WEDNESDAY: Weekly mortgage applications, oil inventories, FOMC minutes, Fed's Bullard speaks; earnings from Abercrombie & Fitch, BJ's, Target and HP.
THURSDAY: Weekly jobless claims, existing home sales, Philadelphia Fed survey, leading indicators, money supply, Halliburton shareholder meeting, Intel shareholder meeting, McDonald's shareholder meeting, Sallie Mae annual meeting, LinkedIn IPO; earnings from GameStop, Sears and Gap.
FRIDAY: JCPenney shareholder meeting, Macy's shareholder meeting, Time Warner shareholder meeting; earnings from Ann Taylor
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