Even as companies’ quarterly results have come in strong, their earnings calls have raised concerns that rising commodity prices may pinch profit margins in the future.
The possibility that temporary exemptions on steel and aluminum tariffs might expire for several U.S. allies also weighed on U.S. stocks. Without an extension from U.S. President Donald Trump, the exemptions will expire on Tuesday.
“That might be the most negative (news event) this week,” said Stephen Massocca, senior vice president at Wedbush Securities in San Francisco. “It’s not going to be viewed well by the market.”
The Dow Jones Industrial Average fell 148.04 points, or 0.61 percent, to 24,163.15, the S&P 500 lost 21.86 points, or 0.82 percent, to 2,648.05 and the Nasdaq Composite dropped 53.53 points, or 0.75 percent, to 7,066.27.
For the month, the S&P 500 rose 0.27 percent, the Dow added 0.25 percent and the Nasdaq gained 0.04 percent.
Earlier in Monday’s session, U.S. stocks were helped by data on income and spending that kept broader inflation worries in check. U.S. personal income rose 0.3 percent in March, compared with expectations of 0.4 percent. On the consumption side, personal spending growth in February was revised lower to 0.3 percent, instead of the previously reported 0.4 percent.
McDonald’s Corp shares jumped 5.8 percent after the world’s biggest fast-food chain by revenue topped analysts’ forecasts for profit and sales.
Shares of Allergan fell 5.2 percent after the company’s chief executive said he was opposed to fundamental changes to the drug company’s business strategy.
Celgene shares fell 4.5 percent. Morgan Stanley said it expects a delay of up to three years for Celgene’s key multiple sclerosis drug, ozanimod.
Shares of T-Mobile US Inc and Sprint Corp sank on worries that the two companies’ $26 billion merger would face regulatory challenges. Sprint shares tumbled 13.7 percent, and T-Mobile shares dropped 6.2 percent.
Arconic Inc shares fell 20.6 percent after the aluminum products maker slashed its 2018 forecasts.
Declining issues outnumbered advancing ones on the NYSE by a 1.74-to-1 ratio; on Nasdaq, a 1.99-to-1 ratio favored decliners.
The S&P 500 posted 22 new 52-week highs and 11 new lows; the Nasdaq Composite recorded 55 new highs and 46 new lows.
Volume on U.S. exchanges was 6.81 billion shares, compared to the 6.57 billion average over the last 20 trading days.
(Additional reporting by Sruthi Shankar in Bengaluru; Editing by Jonathan Oatis and James Dalgleish)
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