NEW YORK ( TheStreet) -- Major U.S. stock averages slumped Monday, dragged down by political uncertainties in Europe and disappointing factory orders here at home. Spain's opposition Socialist Party urged Prime Minister Mariano Rajoy to step down over corruption allegations, which he has refuted. An external investigation on the matter is expected to begin in a few weeks. The Spanish prime minister and German Chancellor Angela Merkel were to meet in Berlin Monday ahead of the European Union leaders' summit in Brussels later this week. In Italy, former Prime Minister Silvio Berlusconi is experiencing mounting popularity, potentially interfering with reforms carried out by the incumbent technocrat government. Italy's general elections are scheduled to start in late February. Amid the news, the yield on the Spanish 10-year bond soared to its highest level since December at 5.3%. The DAX in Frankfurt declined 2.5% and the FTSE in London fell 1.6%. The Dow Jones Industrial Average plunged 102 points, or 0.7%, to 13,908. Breadth was overwhelmingly negative, with 29 of 30 components in the red. The biggest percentage blue-chip laggards were Travelers ( TRV), Merck ( MRK), Microsoft ( MSFT) and Bank of America ( BAC). Microsoft was down 1.4%. Negotiations on buying out Dell ( DELL) continued over the weekend, with reports saying a deal could be achieved in a matter of days. CEO Michael Dell, private-equity firm Silver Lake Partners and Microsoft are reportedly the buyers. Dell shares were down more than 2.5%. Chevron ( CVX) also slumped. Chevron was downgraded to "neutral" from "buy" at UBS on a valuation basis. Shares fell 1.1%. The S&P 500 fell 17 points, or 1.2%, to 1,496. The Nasdaq slid 48 points, or 1.5%, to 3,131. All sectors in the broad market were in the red. The heaviest decliners were energy, conglomerates, financials and technology. Volumes were at 3.36 billion shares on the New York Stock Exchange and 1.86 billion shares on the Nasdaq. Decliners were outnumbering advancers by a ratio of 3.6-to-1 on the Big Board and 3.3-to-1 on the Nasdaq. The Dow broke 14,000 on Friday for first time since 2007 and logged the longest weekly winning streak since the six-week period ended Aug. 17. "In our view, we believe stock prices can continue to rise, but we would encourage selectivity when investing," a BlackRock note said. "We continue to favor emerging markets (including China) and mega-cap U.S. stocks, which should benefit from the improvements in the global economy." "Given the strong market internals, we believe both the Dow and the S&P 500 will retest its 2000/2007 in coming weeks," Piper Jaffray's technical research team said in a morning note. "Our intermediate-term market timing gauges remain in buy positions and our short-term gauges are close to being overbought," the team added. The U.S. economic calendar is comparatively light this week after last week's data deluge. The Census Bureau said Monday that factory orders rose 1.8% in December after falling by a downwardly revised 0.3% in November. Economists were expecting factory orders to rise 2.2% in December. "Although slightly light relative to consensus expectations, this report further corroborates the picture of manufacturing reacceleration painted by the recent ISM data," said John Ryding and Conrad DeQuadros, the founders of research firm RDQ Economics. This week, 89 companies in the S&P 500 are expected to report fourth-quarter earnings, according to Thomson Reuters. The Thomson Reuters report, released Friday evening, said fourth-quarter earnings are now expected to grow 3.8% from a year earlier. Of the 239 companies in the S&P 500 that have reported earnings to date for fourth quarter, 68% have reported earnings above analyst expectations, according to Thomson Reuters. This is higher than the long-term average of 62% and higher than the average over the past four quarters of 65%. Gold for April delivery added $5.80 to settle at $1,676.40 an ounce at the Comex division of the New York Mercantile Exchange, while March crude oil futures lost $1.60 to close at $96.17 a barrel. The benchmark 10-year Treasury gained 16/32 to lower the yield to 1.960%. The dollar rose 0.45%, according to the U.S. dollar index. In corporate news, Clorox ( CLX) posted quarterly earnings of 93 cents a share on revenue of $1.33 billion, surpassing the average analyst estimate of 81 cents a share on revenue of $1.27 billion. The consumer products company's home-care business experienced a surge in demand for disinfecting wipes due to the severity of this year's flu season. Shares gained 0.71%. The company raised its full-year outlook to 3% to 5% sales growth. Oracle ( ORCL) opened its wallet again, announcing a $1.7 billion deal to acquire networking specialist Acme Packet ( APKT). Acme Packet shares soared 23%. Oracle shares shed 3.1%. Herbalife ( HLF) shares slumped 1.3% as the New York Post reported that the weight-management and nutritional-supplements company is the subject of a law-enforcement probe. Humana ( HUM) posted fourth-quarter earnings of $1.19 a share, beating the average Wall Street forecast of $1.07 a share as the health insurer's operating cost ratio declined. Revenue came in at $9.56 billion, versus the average expectation of $9.73 billion. Shares popped 4.7%. Sysco ( SYY) shares tumbled 2.7% after the North American distributor of food and related products said its quarterly net earnings decreased 11.5% from the prior year with food cost inflation at 2.5%, driven mainly by increases in the poultry and meat categories. -- Written by Andrea Tse and Joe Deaux in New York. >To contact the writer of this article, click here: Andrea Tse.