U.S. stocks declined on Monday, extending a two-week slide, as worries about the falling price of oil took hold before the start of quarterly earnings."We had a great run last year and a little bit of indigestion now based upon the decline in energy prices and the perceived impact on fourth-quarter earnings," Phil Orlando, equity market strategist at Federated Investors, said. Oilfield-services provider Schlumberger (SLB) declined after Goldman Sachs Group downgraded its shares to neutral from buy, while also cutting its outlook for benchmark oil prices. "Goldman's negative outlook on oil is putting oil on its knees; we're at a new low here for the year," Peter Cardillo, chief market economist at Rockwell Global Capital, said. Bristol-Myers Squibb (BMY) jumped after the drug developer reported upbeat results on a potential treatment for a common form of lung cancer; Lululemon Athletica (LULU) rose after the maker of yoga clothes hiked its outlook for fourth-quarter revenue and profit; SanDisk (SNDK) dropped after the supplier of memory chips for Apple (AAPL)'s phones projected lower quarterly revenue than previously forecast; Tiffany (TIF) tumbled after the upscale jeweler cut its full-year earnings outlook. NPS Pharmaceuticals (NPSP) surged after Shire (London Stock Exchange: SHP-GB) said it would pay about $5.2 billion to purchase the developer of medicines to treat rare disease; Roche Holding (Swiss Exchange: ROG-CH) said it would pay more than $ billion for a majority stake in genomic-test maker Foundation Medicine (FMI).
The CBOE Volatility Index (^VIX), a measure of investor uncertainty, jumped nearly 11 percent to 19.47. Chevron (CVX) and Exxon Mobil (XOM) led blue-chip declines, which had a 56-point gain quickly evaporating and the Dow Jones Industrial Average (Dow Jones Global Indexes: .DJI) falling as much as 165 points before ending at 17,640.84, down 96.53 points, or 0.5 percent. The S&P 500 (^GSPC) shed 16.52 points, or 0.8 percent, to 2,028.29, with energy leading declines and telecommunications the sole sector in the green among its 10 major industry groups. The Nasdaq (^IXIC) declined 39.36 points, or 0.8 percent, to 4,664.71. For every share rising, less than two fell on the New York Stock Exchange, where 778 million shares traded. Composite volume topped 3.4 billion.
The U.S. dollar (Exchange:.DXY) gained against the currencies of major U.S. trading partners and the yield on the benchmark 10-year Treasury note (U.S.:US10Y) fell 4 basis points to 1.9105 percent. "As soon as we get a day or two of stabilization, oil drops off a cliff again," Randy Frederick, managing director of trading and derivatives at Charles Schwab, said of the crude's descent. On the New York Mercantile Exchange, crude futures for February (New York Mercantile Exchange: @CL15G) delivery below $46 a barrel for the first time since April 2009, ending down 4.7 percent, at $46.09 a barrel; gold futures (CEC:Commodities Exchange Centre: @GC15G) rose to $1,232.80 an ounce.
After the close, Alcoa (AA) reports fourth-quarter results, marking the unofficial start to the earnings season. The aluminum producer gained after Nomura Holdings advised purchasing its shares. JPMorgan Chase (JPM), Wells Fargo (WFC) and Citigroup (NYSE:C) are among the major banks scheduled to report earnings later in the week.
On Friday, U.S. stocks dropped, pulling benchmarks back into the red for the year, as the December jobs report topped expectations but hourly earnings declined, and investors tracked events in France after Wednesday's massacre at Charlie Hebdo, a satirical magazine in Paris.
"It was Paris that finally hit the market," Cardillo said of the terror attacks, the worst in the French capital in more than 50 years. Coming Up This Week: Monday Earnings after the close: Alcoa (AA) Wednesday Earnings before the bell: JPMorgan Chase (JPM), Wells Fargo (WFC) 8:30 a.m. Eastern: Retail sales for December 8:30 a.m.: Import prices 10 a.m.: Business inventories for November 2 p.m.: Beige Book Thursday Earnings before the bell:Bank of America (BAC), Citigroup (NYSE:C) Earnings after the bell: Intel 8:30 a.m.: Jobless claims, weekly 8:30 a.m.: Empire State survey for January 10 a.m.: Philadelphia Fed survey Friday Earnings before the bell: Goldman Sachs Group (GS) 8:30 a.m.: CPI for December 9:15 a.m.: Capacity utilization for December 10 a.m.: Consumer sentiment, preliminary for January More From CNBC.com: Spillover effect of cheap oil: Bankruptcy shock US gas prices haven't been this low since...
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