U.S. stocks slip after biggest weekly loss since 2012

NEW YORK - U.S. stocks are declining in midday trading Monday following the market's biggest weekly loss in two and a half years. The Russian ruble hit a record low against the dollar.

The Standard & Poor's 500 index fell 15 points, or 0.7 percent, to 1,988 as of 12:04 p.m. ET. The Dow Jones industrial average dropped 116 points, or 0.7 percent, to 17,164. The Nasdaq composite fell 51 points, or 1.1 percent, to 4,602.

The price of oil moved lower, erasing an early gain. Benchmark U.S. crude fell $1.11, or 1.9 percent, to $56.71 a barrel on the New York Mercantile Exchange. Oil has fallen about half since June on waning global demand and abundant supplies. The recent drop to five-year lows has been roiling stock markets.

Riverbed Technology and PetSmart are soaring on news that they each have agreed to sell to buyout funds. Riverbed, a maker of computer-network equipment, jumped $1.61, or 9 percent, to $20.35 after agreeing to a $3.6 billion sale to private-equity firm Thoma Bravo and a Canadian pension fund. Pet-supplies chain PetSmart rose $3.26, or 4.3 percent, to $80.92 after announcing Sunday that it had agreed to a $8.7 billion sale to a group of investors led by BC Partners.

U.S. manufacturing output in November surpassed its pre-recession peak as auto production ramped up. The Federal Reserve figures are an encouraging sign that America's factories are somewhat insulated from the global economic slowdown.

The ruble plunged 9 percent to 63.47 to the dollar. The ruble started the year at 32.85 to the dollar. The falling price of oil, which is the chief source of Russian exports and tax revenue, has weighed heavily on the currency.

France's CAC 40 lost 1.6 percent and Germany's DAX fell 1.3 percent. Britain's FTSE 100 was down 1.1 percent.

Japan's ruling coalition won in lower house elections Sunday, giving Prime Minister Shinzo Abe's Liberal Democrats up to four more years. However a business survey released Monday highlighted the challenges facing Abe's government, which is using large-scale monetary and fiscal stimulus to try to end two decades of stagnation. More than two-thirds of companies surveyed said the outlook for the coming quarter wasn't favorable.

"The fears around an oversupply of oil are refusing to go away ... resurfacing questions over the global economic recovery," said Jameel Ahmad, chief market analyst for FXTM.

Japan's Nikkei closed down 1.6 percent. Hong Kong's Hang Seng dropped 1 percent and Seoul's Kospi shed 0.1 percent. Australia's S&P/ASX 200 dropped 0.6 percent. China's Shanghai Composite reversed losses to close up 0.5 percent.

Prices for U.S. government bonds fell. The yield on the 10-year Treasury note rose to 2.12 percent from 2.08 percent late Friday.