NEW YORK ( TheStreet) -- The benchmark U.S. stock indices retreated Monday amid nervousness about second-quarter reporting season and rising Spanish bond yields.

The Dow Jones Industrial Average closed down 36 points, or 0.28%, at 12,736. The blue-chip index, which has now fallen in three straight sessions, did catch a slight bounce toward the end of session to finish roughly 50 points above the day's low of 12,686.

The S&P 500 dipped 2 points, or 0.16%, to finish at 1352, and the Nasdaq shed nearly 6 points, or 0.19%, to settle at 2931.

Within the Dow, 15 of 30 components moved lower, led by Bank of America ( BAC), du Pont ( DD), Exxon ( XOM) and Caterpillar ( CAT).

Blue-chip gainers included Merck ( MRK), Verizon ( VZ) and Wal-Mart Stores ( WMT).

Shares of Boeing were also among the index's winners after Air Lease ( AL) placed an order valued at $7.2 billion for 60 of the company's 737 MAX 8 and 15 737 MAX 9 airplanes. Boeing's stock rose 0.5% on the day.

The weakest sectors in the broad market were energy, consumer cyclicals and basic materials. Conglomerates and health care recorded gains.

Overall, expectations for second-quarter earnings are muted. According to data from Thomson Reuters, analysts are expecting year-over-year growth of 5.8% from the S&P 500. However, the financials are benefiting from an easy comparison to last year because of the Bank of America ( BAC) mortgage lawsuit settlement. Excluding Bank of America, second-quarter growth is estimated to be just 0.7%. Excluding the entire financials sector, earnings are estimated to dip 0.3% year-over-year.

"It looks like the analyst community has been lowering expectations for the near quarters but leaving the fourth quarter intact as far as higher growth to keep full-year numbers where they want them," said Brian Lazorishak, portfolio manager and quantitative analyst at Chase Investment Council. "This is the time of year when you need to start reining in those fourth-quarter expectations."

"Even if you get good news at times, the stronger dollar is having a reverse effect on equities," added Peter Cardillo, chief market economist at Rockwell Global Capital. "Generally speaking, earnings is going to be much weaker than what we've been expecting. The market has already prepared itself for that. I think it will be a nervous earnings season. But it won't be one where we'll see negative earnings for all the sectors."

According to estimates compiled by S&P Capital IQ, Wall Street analysts are projecting a 1% decline in operating earnings for the calendar second quarter. Sam Stovall, the firm's chief equity strategist, said investors could argue that this is just another instance of a slowdown in global economic growth but he feels this is a surface assessment.

"On the other hand, one could say 'new quarter, old trick,' meaning that this is merely a continuation of management's efforts to guide EPS growth estimates to unrealistically low levels," said Stovall. "It appears as if there is enough blame to go around, should Q2 results truly be disappointing."

Stovall said that one offsetting factor to all the worries about global economic growth has been the near 12% year-over-year declines in oil prices.

After the close, Alcoa ( AA) kicked off reporting season, beating Wall Street's profit view by a penny. The stock was adding nearly 1% in extended trading.

Shares of Advanced Micro Devices ( AMD) were weak in late trades after the No. 2 chip maker forecast a sequential decline in revenue of 11% for the second quarter, much lower than its previous forecast for an increase of 3%. The company attributed the weak outlook to softer-than-expected channel sales in China and Europe and weakness in consumer PC sales. The stock was down nearly 6%.

The FTSE in London closed down 0.62%, and the DAX in Germany was down 0.35%. Hong Kong's Hang Seng stock index settled lower by 1.88% and the Nikkei in Japan finished down 1.37% after Chinese Premier Wen Jiabao spoke of tremendous pressure on China's economy over the weekend and a report showed that Japanese machinery orders declined sharply.

Eurozone finance ministers met Monday in Brussels but the markets remain skeptical about their ability to achieve much in their discussions on stemming the eurozone debt crisis. Spanish ten-year bond yields peeked back above 7% as investors awaited developments out of the meeting, including updates on a rescue package for Spain's banks and reassurances on a follow through on agreements that unfolded at last month's European Union summit.

August crude oil futures advanced $1.54 to settle at $85.99 a barrel, and August gold futures settled up $10.20 to $1,589.10 an ounce.

The benchmark 10-year Treasury rose 11/32, diluting the yield to 1.517%, while the greenback was down 0.21%, according to the dollar index.

In corporate news, health benefits company WellPoint ( WLP) agreed to acquire managed health care firm Amerigroup ( AGP) for about $4.9 billion. Based on Friday's close at $64.34, the per share consideration of $92 represents a 43% premium. WellPoint shares rose more than 3%.

Best Buy ( BBY), the consumer electronics retailer, is laying off a total of 2,400 workers as part of its restructuring efforts. The stock finished down more than 1.9%.

Shares of Sirius XM ( SIRI) added 1.5% after the satellite radio company forecast full-year revenue of $3.4 billion, up from its May estimate of $3.3 billion. Sirius XM also predicted net new subscriber growth of 1.6 million, up from the previous estimate of 1.5 million.

Facebook ( FB) shares tacked on 1.4% as the social networking giant and Yahoo! ( YHOO) settled a patent dispute. Yahoo! shares closed down 0.19%.


--Written by Andrea Tse in New York.

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