U.S. stocks ended Monday with their sharpest decline in six weeks, marking a fourth consecutive session of losses for the S&P 500.
The sharp drop follows six straight weeks of gains, which represents the longest positive streak in about a year.
“Today’s selloff does not make a lot of sense because there wasn’t any big economic or corporate news. It is puzzling to see such a delayed reaction to a strong jobs report in an otherwise quiet week,” said Randy Frederick, managing director of trading & derivatives at Schwab Center for Financial Research.
The S&P 500 /zigman2/quotes/210599714/realtime SPX +1.23% fell 20.60 points, or 1%, to 2,078.60. The selloff was broad-based with nine of the index’s 10 main sectors closing lower.
The decline on the S&P 500 on Monday was the largest since Sept. 28. The next support level is at the index’s 200-day moving average, or 2,063, according to Frank Cappelleri, senior market technician at Instinet.
The Dow Jones Industrial Average /zigman2/quotes/210598065/realtime DJIA +2.17% lost 179.85 points, or 1%, to 17,730.48 with 28 of its 30 components finishing lower, led by Caterpillar Inc. /zigman2/quotes/203434128/composite CAT +4.39% which shed 2.6%.
Meanwhile, the Nasdaq Composite /zigman2/quotes/210598365/realtime COMP +0.17% declined 51.82 points, or 1%, to 5,095.30.
“Markets cannot escape the gravitational pull of the Fed, so stocks are under pressure because of the fact that we may see interest rates rise in December,” said Kim Forrest, senior analyst and portfolio manager at Fort Pitt Capital Group. Ultraloose monetary policy has been associated with a prolonged bull rally in stocks.
“It is also possible weak overnight data from China added downward pressure on global equities,” Forrest added.
Friday’s stronger-than-expected employment report, showing 271,000 new jobs created last month, increased the odds of a Federal Reserve rate increase in December, with the CME Group’s FedWatch tool now pricing in the likelihood of a rise at 70%.
The data triggered a spike in the U.S. dollar, which rose to a six-month high against the euro on Friday and saw its largest weekly gain against the yen since May. On Monday, the dollar gave back some of the gains. But some strategists say investors are far too complacent about the strong dollar.
Stocks to watch: Shares of Priceline Group Inc. sank 9.6% after the company reported disappointing third-quarter results, putting it on track to suffer the biggest one-day price drop in its 16½-year history.
Sotheby’s shares stumbled 6.1% after the auction house reported a narrower-than-expected loss.
Dean Foods Co . shares rallied 7.3% after the company swung into profit in the third quarter.
Hertz Global Holdings Inc. /zigman2/quotes/200655672/composite HTZ -80.46% shares tumbled 13% after the car rental company’s revenue fell short of expectations on currency effects.
Berkshire Hathaway Inc. /zigman2/quotes/208872451/composite BRK.A +2.75% /zigman2/quotes/200060694/composite BRK.B +3.09% reported late Friday that it more than doubled third-quarter profit on an investment linked to its Kraft Heinz Co. /zigman2/quotes/203625533/composite KHC +0.88% stake. Berkshire Hathaway’s Class B Shares were down 1.7%.
Retail and consumer-based companies will be in focus this week as earnings season winds down. About nine-tenths of companies on the S&P 500 have already reported earnings.
Tinder parent Match Group Inc. on Monday set a range for its initial public offering of $12 to $14, as it said it was seeking to raise $536.7 million. Read: Five things to know before Match’s IPO.
Other markets: In China, the Shanghai Composite Index /zigman2/quotes/210598127/delayed CN:SHCOMP -0.34% closed up 1.6%, climbing to its highest level since late August. Over the weekend, data showed Chinese exports in October fell a fourth straight month, and by a larger amount than economists had expected, and some analysts said that could pressure Chinese authorities into increasing stimulus.
The Nikkei 225 index /zigman2/quotes/210597971/delayed JP:NIK +0.70% finished nearly 2% higher, benefiting from a weak Japanese yen. In Europe, the Stoxx Europe 600 index /zigman2/quotes/210599654/delayed XX:SXXP +0.92% closed 1.1% lower.
Oil prices /zigman2/quotes/209727478/delayed CLZ25 +2.19% fell 1%, to settle at $43.87 a barrel, extending a losing streak to four sessions. Gold prices eked out their first gain in eight sessions, tacking on 40 cents to settle at $1,088.10 an ounce.
—Sue Chang contributed to this article.