Mounting concerns over the impact of the massive earthquake in Japan pushed stocks lower Monday. The earthquake and tsunami along Japan's northeast coast killed thousands and has raised fears of a slowdown in the world's third-largest economy.
All 10 company groups that make up the Standard and Poor's 500 index fell. Utilities companies lost 1.5 percent, the most of any group, on worries that the disaster may lead to dimming prospects for nuclear power plants.
The S&P index, the basis for most U.S. mutual funds, fell 7.89 points, or 0.60 percent, to 1,296.39.
The Dow Jones industrial average fell 51.77, or 0.43 percent, to 11,992.63. The Nasdaq composite fell 14.64, or 0.54 percent, to 2,700.97.
"Everything is linked now," said David Katz, senior portfolio strategist at Weiser Capital Management. "There is no such thing as a catastrophe happening in any major country and it not affecting the global economy."
Japan's central bank pumped a record $184 billion into money market accounts to encourage bank lending. Financial analysts said the move could put pressure on Japan to raise interest rates, particularly since the country is saddled with a massive debt that, at 200 percent of gross domestic product, is the biggest among developed nations.
"The fiscal position is deteriorating in Japan," said Channing Smith, managing director of equity strategies at Capital Advisors Inc. "If we get higher interest rates, that is a major threat to ... the global recovery."
Japan's benchmark Nikkei 225 index fell 633.94 points, or 6.2 percent, to close at 9,620.49 — its lowest level in four months. The decline wiped out this year's gains.
Upscale retailers with large businesses in Japan fell. Tiffany & Co. lost 5 percent, and Coach Inc. lost 5.4 percent. Caterpillar Inc. gained 1.8 percent on assumptions that it will benefit from large-scale rebuilding efforts.
In the U.S., Warren Buffett's Berkshire Hathaway Inc. said it would purchase chemical company Lubrizol for $9 billion in cash. Berkshire will pay $135 per share, a 28 percent premium to Lubrizol's closing stock price Friday of $105.44. Berkshire's Class B shares fell 1 percent on the news, while Lubrizol rose 27 percent.
Cephalon Inc. fell 2 percent after a federal court overturned two of the patents on its painkilling drug Fentora. That could allow competitors to start selling cheaper generic versions of the drug soon.
Bond prices rose, sending yields lower. The yield on the 10-year Treasury note fell to 3.37 percent from 3.41 percent late Friday. Oil prices fell 58 cents to $100.56 a barrel.