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US: Stocks retreat from records; GE, tech shares fall
[NEW YORK] The Dow's five-day streak of records ended on Monday as General Electric shares dived and the broader US market retreated at the start of a heavy week of earnings reports.
Investors are skeptical that earnings will justify soaring stock values, said Art Hogan, chief market strategist at Wunderlich Securities. Nearly 200 companies from the S&P 500 are scheduled to report results this week, including General Motors, McDonald's and Amazon.
"We've got things that are priced to perfection," Mr Hogan said. "We have to figure out which companies have gotten ahead of themselves." Mr Hogan also said that Friday's euphoria has subsided after last week's Senate vote on a preliminary step to tax cuts in recognition that the measure still has a long way to go.
The Dow Jones Industrial Average ended down 0.2 per cent at 23,273.96.
The broad-based S&P 500 fell 0.4 per cent to 2,564.98, while the tech-rich Nasdaq Composite Index dropped 0.6 per cent to 6,586.83.
General Electric plummeted 6.4 per cent as analysts continued to digest Friday's disappointing earnings report, with UBS downgrading the industrial giant and pondering the likelihood of a divided cut.
Morgan Stanley also downgraded GE, while Bank of America upgraded the company.
Several high-flying technology companies stumbled, including Amazon, Facebook and Google parent Alphabet, all of which lost 1.5 per cent or more. Apple and Microsoft ended little changed.
Hasbro sank 8.6 per cent after it projected lower-than-expected fourth-quarter sales growth due to uncertainty from the Toys "R" Us bankruptcy. Rival Mattel lost 3.2 per cent.
Sporting goods and sneaker company Under Armour slid 4.3 per cent following a Wall Street Journal report that co-founder Kip Fulks was on sabbatical and that the company was considering exiting tennis and some other categories amid slowing sales.