Worse-than-expected Economic Data Thwarts Rally

The yield on the benchmark 10-year Treasury note, which moves opposite its price, slipped to 3.54 percent from 3.62 percent. Last week, the 10-year yield surged to a six-month high of 3.75 percent.

The dollar gained ground against the euro and the British pound, while gold prices sank.

The Russell 2000 index of smaller companies fell 3.92, or 0.7 percent, to 522.71.

Overseas, Japan's Nikkei stock average added 0.4 percent, Britain's FTSE 100 fell 2.1 percent, Germany's DAX index fell 1.7 percent, and France's CAC-40 fell 2.0 percent.