Finicky market drops as tech stocks slip

U.S. stock indexes gave up some of their recent gains Monday, pulling the S&P 500 slightly below the record high it hit last week.

Technology, communication and energy stocks weighed on the market, outweighing gains by a broad mix of companies, including banks and those that rely directly on consumer spending, such as Nike and Chipotle.

Bond yields inched higher after easing most of last week. Investors have been focusing on the economic recovery as well as the risks higher inflation pose to consumers and companies. Those concerns have helped push up bond yields for much of this year.

Monday’s pullback snapped a three-day winning streak for the benchmark S&P 500, which closed out last week with its third straight weekly gain.

“It’s this back and forth as the market tries to figure out how strong the economy is going to be and how long its going to last,” said Tom Martin, senior portfolio manager with Globalt Investments.

The S&P 500 slipped 0.81 points, or less than 0.1 percent, to 4,127.99. The Dow Jones Industrial Average fell 55.20 points, or 0.2 percent, to 33,745.40. The techheavy Nasdaq composite lost 50.19 points, or 0.4 percent, to 13,850. The S&P 500 and Dow each set record highs Friday.

Small company stocks, which have been outgaining the broader market this year, also fell. The Russell 2000 index of smaller companies gave up 9.69 points, or 0.4 percent, to 2,233.78. The index is up 13.1 percent so far this year, while the S&P 500, which tracks large companies, is up 9.9 percent.

Technology stocks were the biggest drag on the market. Apple fell 1.3 percent and Google’s parent company slid 1.1 percent.

The sector has been choppy as investors shift money to other industries that could see solid gains as the economy recovers. Rising bond yields have also made technology stock values look pricey after months of big gains.

The yield on the 10-year U.S. Treasury note, which influences interest rates on mortgages and other loans, inched up to 1.67 percent. It ended Friday at 1.66 percent and had been as high as 1.75 percent last Monday.

Traders are showing cautious optimism about the economic recovery, especially in the U.S., where vaccine distribution as been ramping up and President Joe Biden has advanced the deadline for states to make doses available to all adults to April 19.

While many economists are projecting a strong economic rebound this year, some companies that stand to benefit from the reopening of the economy were among the decliners Monday. Cruise operators Carnival and Royal Caribbean fell 5.3 percent and 3.1 percent, respectively.