Investors are hitting the pause button Monday, after last week’s record-breaking rally.
The Dow Jones Industrial Average was little changed in early trading. The S&P 500 was down 0.1% and the Nasdaq dropped 0.2%.
Stocks have been surprising investors with their resilience especially with the “anticipation of additional spending cuts” from the sequester, said Brown Brothers Harriman strategist Marc Chandler, in a client note.
Investors have largely shrugged off the forced budget cuts, instead focusing on strong corporate earnings and the economic recovery.
This week’s main focus will be on retail sales, as investors look for further signs of strength.
The numbers, due out Wednesday, will be even more closely watched than normal as investors are keen to see whether the increased payroll tax, delayed tax refunds and higher gas prices have caused consumers to pull back. February sales are expected to have risen 0.5%, according to economists polled by Briefing.com.
Wal-Mart warned last month that February sales had been softer than expected.
Stocks wrapped one of the best weeks of the year Friday, with the Dow closing at a record high for the fourth straight day. The S&P is less than 1% from hitting its all-time high.
On the corporate front Monday, shares of Dick’s Sporting Goods fell more than 8% after the retailer reported earnings and sales that fell short of forecasts. The company also said it expected a sharp slowdown in same-store sales for the first quarter.
Renren easily beat revenue forecasts, but shares of the Chinese social media company dipped nearly 1% as concerns about rising expenses remain.
Billionaire investor Carl Icahn signed a confidentiality agreement with Dell to review the PC maker’s financial information, a move that could head off a showdown over Michael Dell’s buyout.
Shares of Genworth Financial rose 6% after an article in Barron’s called the stock undervalued.
General Electric named former SEC chairman Mary Schapiro to its board of directors.
European markets were mostly lower in afternoon trading, while Asian markets ended mixed.
Overall, global markets have been joining in the rally, with Japan’s Nikkei surging 18% so far this year.
“Japan’s economy seems to be on the mend, though it is really too early to attribute it to Abenomics,” said Chandler, referring to Japanese Prime Minister Shinzo Abe and his plans for economic stimulus.
Hong Kong’s Hang Seng was flat, dragged down by concerns over Chinese manufacturing.
The dollar rose against the British pound and the Japanese yen, but fell against the euro, .
Oil prices dropped, while gold prices moved slightly higher.
The price on the 10-year Treasury edged higher, pushing the yield down to 2.05% from 2.06% Friday.
