Updated from 4:20 p.m. EDT
Stocks in the U.S. closed lower Monday as early optimism touched off by a series of tech upgrades faded following news of a nationwide auto workers strike at
Dow Jones Industrial Average
was down 61.13 points, or 0.44%, at 13,759.06. The
was 8.02 points, or 0.53%, lower at 1517.73, and the
was down 3.27 points, or 0.12%, to 2667.95.
On the Dow, shares of GM pulled back after United Auto Workers members walked off the job at 11 a.m. EDT following the union's failure to get a labor agreement. GM had traded up roughly 5% earlier in the session, but its shares lost momentum and finished off 20 cents, or 0.6%, at $34.74.
also made headlines after CEO Alan Mulally said North American operations could return to profitability in 2009 despite a weak forecast for the American auto industry. Shares were up 25 cents, or 3%, to $8.48.
On the bright side, tech shares finished higher thanks in part to
. Bear Stearns and Citigroup both upgraded the stock because of valuation. Citi also reiterated a buy on
and lifted its target by $25 to $185. Shares of EMC jumped 7.8% to $20.51, and Apple gained 2.9% to close at $148.28.
Elsewhere, RBC Capital Markets upgraded
to outperform from sector perform, citing improvements in the company's handset unit. Motorola climbed 16 cents, or 0.9%, to $18.05.
rose 1.5% ahead of the launch of the video game
, a title that's expected to boost sales of the Xbox 360 console. Separately,
The Wall Street Journal
reported that the software giant is considering buying a stake in the social-networking site Facebook for $300 million to $500 million. Shares added 43 cents to $29.08.
Breadth was negative to start the week. On the
New York Stock Exchange
3.13 billion shares changed hands, as decliners topped advancers by a 5-to-3 margin. Volume on the Nasdaq reached 1.82 billion shares, with losers outpacing winners nearly 3 to 2.
U.S. equities had started the session with momentum carrying over from a strong finish Friday, when the Dow added 53.49 points, or 0.39%, to 13,820.19. The S&P 500 was up 7 points, or 0.46%, to 1525.75, and the Nasdaq was better by 16.93 points, or 0.64%, to 2671.22.
The indices notched their second winning week in a row, thanks to the
50-basis-point interest rate cut last Tuesday. The Dow and the S&P 500 both climbed 2.8% for the week, and the Nasdaq added 2.7%.
"The market is very calm and is still digesting gains from last week," said Robert Pavlik, chief investment officer with Oaktree Asset Management. "Traders are still grappling with recession vs. inflation, even after the Fed rate cut. Worries about the credit problem and a slowing economy cannot be erased overnight."
As the week progresses, investors will be getting another batch of economic data that they will use to guess how the Fed will act next. Although no releases were out Monday, reports on existing-home sales, new-home sales, durable-goods orders, second-quarter gross domestic product and others are due later this week.
Fed Chairman Ben Bernanke delivered a speech on education in Washington, but he made no mention of monetary policy. Richard Fisher, president of the Dallas Fed, said that the central bank can alter monetary policy in either direction if necessary and that recent trends in inflation and expectations provide "wiggle room" for adjustments.
Fed Governor Fred Mishkin will speak Thursday and Friday on globalization and monetary policy.
The earnings docket was relatively empty, but plenty of reports are due by week's end. Homebuilders
, along with
Bed Bath & Beyond
, are set to release quarterly results during the next few sessions.
Away from stocks, Treasury prices were mixed. The 10-year note was flat in price, yielding 4.62%, while the 30-year bond added 4/32 to yield 4.88%. The dollar continued its free fall, hitting a new record low against the euro.
Marc Pado, U.S. market strategist with Cantor Fitzgerald, said that after the initial Fed-inspired rally, the market is worried about the repercussions of a weaker dollar.
"The dollar has been in a major decline since 2002 but broke to a new 15-year low on the Dollar Index on Friday," he said. "The euro traded over $1.40, the highest on record. Talk that the Saudis may move away from a dollar peg has many worried that we could see continued pressure on the dollar, and maybe even a move away from crude being priced in dollars."
Commodity prices were mixed. The front-month November crude contract lost 67 cents to close at $80.95 a barrel. Gold and silver futures inched higher on the day.
Overseas, Hong Kong's Hang Seng jumped 2.7%, and London's FTSE 100 added 0.1%. Germany's Xetra Dax slipped 0.1%.