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Stocks retreat from records; earnings and Fed ahead

Kate Gibson

U.S. stocks fell on Monday, with Wall Street retreating from all-time highs, as investors looked to the start of the earnings season and considered whether the Federal Reserve would hike interest rates sooner than expected.

GT Advanced Technologies (NASDAQ:GTAT - News) declined after UBS downgraded the provider of electronics technology to neutral from buy and Canaccord Genuity Group cut the stock to hold from buy.King Digital Entertainment (NYSE:KING - News) rose after Piper Jaffray recommended investors purchase shares of the maker of video games.

On Tuesday, Alcoa (NYSE:AA - News) releases second-quarter earnings, with Wells Fargo (NYSE:WFC - News) following three days later.

"What we're going to need to hear managements say in their quarterly releases is that they're comfortable with the outlook; the real question is will they cut guidance for the second half," said Tobias Levkovich, chief U.S. equity strategist at Citigroup.

Read More Earnings could put more sizzle into the stock market's bull run

Multiple Dow components will be among the dozens of large companies slated to release earnings next week.

Goldman Sachs Group moved up its projected timing for the Fed to raise interest rates, forecasting the central bank would increase its benchmark rate in the third quarter of 2015 instead of the first three months of 2016.

The Fed on Wednesday is scheduled to release the minutes from its June policy session.

After a 75-point drop, the Dow Jones Industrial Average (Dow Jones Global Indexes: .DJI) was lately off 64.85 points, or 0.4 percent, at 17,003.40, with UnitedHealth Group (NYSE:UNH - News) leading blue-chip losses that included 22 of 30 components.

Read More Dow 17,000? Another milestone matters more

The S&P 500 (INDEX:^GSPC - News) dropped 9.86 points, or 0.5 percent, to 1,975.58, with materials falling the most and telecommunications the best performing among its 10 major sectors.

After marking a third straight week of gains last week, the Nasdaq (NASDAQ:^IXIC - News) lost 33.33 points, or 0.8 percent, to 4,452.59.

The Chicago Board Options Exchange Volatility Index (INDEX:^VIX - News), a measure of investor uncertainty, rose 11.1 percent to 11.47.

For every share rising, more than two declined on the New York Stock Exchange, where 249 million shares traded as of 12:55 p.m. Eastern. Composite volume neared 1.3 billion.

On the New York Mercantile Exchange, gold futures for August delivery shed $3.30, or 0.3 percent, to $1,317.30 an ounce, and crude-oil futures for August delivery dropped 66 cents, or 0.6 percent, to $103.40 a barrel.

The dollar edged lower against the currencies of major U.S. trading partners and the yield on the 10-year Treasury note used to figure mortgage rates and other consumer loans fell 2 basis points to 2.618 percent.

On Thursday, U.S. stocks rose, lifting the Dow industrials above 17,000, after the government reported the economy created a better-than-expected 288,000 jobs in June and the unemployment rate fell to 6.1 percent.

Read More Dow finishes above 17,000 on strong payrolls report

-By CNBC's Kate Gibson

Coming Up This Week:


Earnings: Alcoa, Bob Evans, The Container Store

7:30 a.m.: NFIB small business survey

10:00 a.m.: JOLTS

1:00 p.m.: $27 billion three-year note auction

3:00 p.m.: Consumer credit


Earnings: WD-40, MSC Industrial, Texas Industries

7:00 a.m.: Mortgage applications

1:00 p.m.: $21 billion 10-year note auction

2:00 p.m.: FOMC minutes


Earnings: Family Dollar, Progressive, Barracuda Networks, Chevron (preliminary), PriceSmart

8:30 a.m.: Jobless claims

10:00 a.m.: Wholesale inventories

1:00 p.m.: $13 billion 30-year auction

1:15 p.m.: Kansas City Fed President Esther George


Earnings: Wells Fargo, Infosys, Fastenal

2:00 p.m.: Federal budget

2:45 p.m.: Atlanta Fed President Dennis Lockhart, Chicago Fed President Charles Evans

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