By William Watts and Joy Wiltermuth
The Dow Jones Industrial Average snapped a 5-session win steak Monday, falling late in the session after pushing above the 35,000 milestone, with the broader market came under pressure as high-profile Big Tech shares tumbled.
What did major indexes do?
The Dow /zigman2/quotes/210598065/realtime DJIA -0.77% fell 34.94 points, or 0.1%, to close at 34,742.82, after reaching an intraday peak at 35,091.56.
The S&P 500 /zigman2/quotes/210599714/realtime SPX -1.30% shed 44.17 points, or 1%, ending at 4,188.43.
The Nasdaq Composite /zigman2/quotes/210598365/realtime COMP -1.96% tumbled 350.38 points, or 2.6%, to finish at 13,401.86.
On Friday, stocks shook off a much-weaker-than-expected April jobs report Friday, with the Dow and S&P 500 both ending at records, while the Nasdaq Composite outpaced its major benchmark peers but still posted a weekly loss.
What drove the market?
Stocks tumbled late Monday, leaving the S&P 500 and Nasdaq Composite with their worst daily losses since March 18, as investors weigh how much of the economic recovery already has been priced into stocks.
“Our point of view is that there are a lot of stocks that are extremely stretched in terms of valuations,” said Sandi Bragar, managing director at Aspiriant, a wealth management firm.
Bragar’s not worried about the pace of the economic recovery or a pullback of central bank’s monetary support this year, but she is worried that with “yields on bonds so low and stocks so high,” that financial markets could be poised for a lot more volatility, “which we haven’t seen that much of this year.”
Friday’s disappointing April jobs report, which saw U.S. nonfarm payrolls rise by 266,000 versus a consensus forecast for an increase of 1 million, had initially been characterized as providing a positive backdrop for equities.
“In our view, the jobs report shows a surprising pause in the labor market recovery, coming at a time when the underlying fundamentals and alternative data are pointed towards acceleration,” wrote analysts at Credit Suisse, in a note.
“Nevertheless, this report should delay any discussion of withdrawing accommodation until a decisive labor market rebound takes place,” they said. “As such, we continue to expect positive equity returns, but at the expense of increased near-term volatility.”
Investors were tracking developments around a cyberattack on a vital pipeline that delivers around 45% of fuel consumed on the East Coast. Alpharetta, Ga.-based Colonial Pipeline over the weekend said it closed the conduit after it was the target of a cyberattack . On Monday, Colonial said it was aiming to “substantially” restore operations by the end of the week.
Gasoline futures /zigman2/quotes/210286597/delayed RB00 -0.74% were up fractionally in recent action . Analysts said pump prices may avert a rise if operations are restored within a few days. Oil futures also close fractionally higher, amid lingering concerns that the incident could chill near-term demand for crude.