Oil Prices Weigh on Stocks

In other research moves, JPMorgan Chase downgraded Occidental Petroleum(OXY Quote) to neutral from overweight, citing the stock's valuation. On Friday, the oil company posted second-quarter earnings and revenue that came in below analysts' estimates. However, after crude's spike in price, Occidental was higher by $2.05, or 2%, to close at $107.29.

Elsewhere, Banc of America cut its price target on chip-equipment maker Applied Materials (AMAT Quote) to $16.50 from $18.90. Applied lost 10 cents, or 0.7%, to finish at $15.40.

Overseas markets were mostly lower, with London's FTSE 100 down 1% to 5828 and Germany's Xetra DAX off 1.7% to 5626. In Asia, Japan's Nikkei dropped 2.2% overnight to 15,154, and Hong Kong's Hang Seng edged up 0.4% to 16,953.

The earnings parade picks up again Tuesday with reports expected from Cisco(CSCO Quote), News Corp.(NWS Quote) and Sara Lee(SLE Quote), among others.