NEW YORK -- U.S. stocks extended their slump Monday afternoon, putting the Standard & Poor’s 500 index on track for its first three-day losing streak since January. Declines were led by companies that sell goods and services that are not essential for shoppers.
KEEPING SCORE: The S&P 500 index fell 21 points, or 1.1 percent, to 1,843 as of 1:56 p.m. Eastern time. The Dow Jones industrial average dropped 146 points, or 0.9 percent, to 16,256. The Nasdaq composite had the biggest decline, down 62 points, or 1.5 percent, to 4,065.
USED CAR SALES: CarMax slipped $2.04, or 4.5 percent, to $43.52 after the company said late Friday that its fourth-quarter earnings fell 7 percent. Net income declined as the effects of an accounting correction offset higher demand for its vehicles. The company’s revenue also fell short of financial analysts’ expectations.
BARBIE WOES: Mattel dropped $1.25, or 3.2 percent, to $38.15 after analysts at BMO Capital cut their outlook for the toymaker. They cited lower demand for key products, like Barbie dolls and Hot Wheels cars. The company has also exhausted its cost-savings opportunities.
FIRST-QUARTER EARNINGS: Investors will start focusing on the outlook for corporate earnings this week, as companies begin to report first-quarter results. Aluminum maker Alcoa, JPMorgan and Wells Fargo are reporting. Companies are expected to report earnings growth of 0.3 percent over last year’s first quarter. That rate of growth, however, is down from 8 percent in the fourth quarter, and would be the lowest since the third quarter, when earnings contracted 1.7 percent, according to S&P Capital IQ.
THE QUOTE: "The expectations are incredibly low, largely due to the impact of winter weather" said Kate Warne, an investment strategist at Edward Jones. Investors will want to see if a company’s business has improved along with the weather. Low expectations could make it easier for companies to outperform, Warne said.
SEEKING SAFETY: Utilities, phone companies and the makers of essential consumer goods were the only three industry sectors in the S&P 500 to rise on Monday. Investors typically buy companies in these industries when the stock market slumps. The S&P 500 index of utilities climbed to its highest level in more than six years.
P&G PAYOUT: Procter & Gamble edged up following news that the maker of Tide detergent would raise its quarterly dividend by 4 cents to 64 cents. P&G rose $1.16 cents, or 1.4 percent, to $80.91.
PHARMA BUY: Questcor Pharmaceuticals jumped $9.70, or 14.3 percent, or $77.70 after Mallinckrodt said it was acquiring the company in a cash-and-stock deal valued at about $5.2 billion.
BORROWING: Later Monday, the Federal Reserve will release a report on how much consumers borrowed in February. The forecast is that borrowing rose slightly to $14 billion, according to FactSet. Some economists consider an increase in borrowing an encouraging sign that people are more confident and willing to take on debt.
FED AHEAD: The U.S. Federal Reserve will release minutes on Wednesday from its meeting in mid-March. Investors will be parsing the minutes from that two-day gathering to try to anticipate the Fed’s next moves on interest rates, and its huge bond-buying program. That buying is being scaled back.
BONDS AND COMMODITIES: Bond prices rose. The yield on the 10-year Treasury note fell to 2.66 percent from 2.72 percent late Friday. The price of crude oil fell $1.09, or 1 percent, to $100.06 a barrel. Gold fell $6, or 0.5 percent, to $1,297.20 an ounce.