Stocks slide after record high runs

NEW YORK — Stocks pulled back Monday on Wall Street as markets around the world paused following record- setting runs.

The Standard & Poor’s 500 index fell 0.7%, breaking a four- day winning streak. Tesla, Amazon, Apple and other big gainers over the last year led the way lower, even as financial, healthcare and energy stocks notched gains. Treasury yields continued to rise.

Analysts said a pullback was no surprise after the big rally recently for stocks, bond yields and commodities amid a wave of optimism. With Democrats set to take control of Washington, investors expect Congress to try soon to deliver more stimulus to the economy through larger cash payments for Americans and other programs. That added to enthusiasm about a strong economic recovery later this year as more COVID- 19 vaccines roll out.

The market managed to look past much of last week’s bad news, including the attack on the U. S. Capitol on Wednesday, surging virus cases, and a disappointing employment report, said Julian Emanuel, BTIG’s chief equity and derivatives strategist. That speaks to the market’s resiliency and could signal a change in attitudes.

“The fact that the market shrugged all of this news off, it’s ushering in a more speculative stage in the bull market,” he said.

The S& P 500 dropped 25.07 points to 3,799.61. The Dow Jones industrial average fell 89.28 points, or 0.3%, to 31,008.69. The Nasdaq composite slid 165.54 points, or 1.3%, to 13,036.43. The three indexes set all- time highs Friday.

Stocks in the S& P 500 are trading at roughly 29 times their earnings. That’s a much more expensive price tag than their average over the last decade of a little below 18, according to FactSet.

“Given where we are in terms of valuation, there’s not going to be tolerance for news that isn’t good,” Emanuel said.

The yield on the 10- year Treasury climbed to 1.13% from 1.09% late Friday.

European markets closed lower and Asian markets were mixed.