Feb. 27, 2012 at 10:21 AM ET
U.S. stocks opened lower on Monday following the S&P 500's four-year closing high last week and after the Group of 20 leading economies told Europe it must commit more money to fight the EU debt crisis before seeking broader help.
The S&P 500 has risen almost 8 percent this year. It has been stuck in a tight range between 1,355 and 1,370 as expectations for a pullback are offset by an ongoing string of data pointing to a firmer recovery in the U.S. economy, including in the key housing and labor markets.
"In the absence of a lot of news you're seeing profit taking to start the day," said Rick Meckler, president of investment firm LibertyView Capital Management in New York, which oversees about $2 billion. "It wouldn't be healthy if there wasn't some profit taking."
The financial and industrial sectors of the S&P 500 were the worst performers in early trading, both declining nearly 1 percent. Financials are still up 11 percent for the year and industrials have gained more than 9 percent in 2012.
Ministers from leading economies told Europe it must disburse extra money if it wants more help from the rest of the world, piling pressure on Germany to drop its opposition to a larger European Union bailout fund.
LibertyView Capital's Meckler said even though he expects the European crisis to continue to dominate the news into the mid-year, U.S. investors are getting used to erratic developments from the euro zone.
The Dow Jones industrial average dropped 91.28 points, or 0.70 percent, to 12,891.67. The S&P 500 Index fell 10.29 points, or 0.75 percent, to 1,355.45. The Nasdaq Composite lost 30.04 points, or 1.01 percent, to 2,933.71.
Through Friday, of the 461 S&P 500 companies that have reported earnings for the most recent quarter 63 percent have beaten analyst expectations. More than 20 companies in the index are expected to report results this week.
Lowe's Cos, the world's second-largest home improvement chain, reported higher-than-expected quarterly sales, and its shares rose 3 percent to $27.95.
Concern about rising oil prices eased slightly as Brent and U.S. crude futures fell more than 1 percent, retreating from recent highs triggered by worries over disruptions to Middle East supplies.
Still, some analysts warned consistently high oil prices could throw a wrench into the global economic recovery.
The National Association of Realtors on Monday said signed contracts for U.S. home resales rose to a nearly two-year high in January, further evidence of a budding recovery in the housing market. (Reporting by Rodrigo Campos; Editing by Padraic Cassidy)