U.S. Stocks Lower As Car Sales Expected To Slide

NEW YORK (MarketWatch) -- U.S. stocks fell on Monday, breaking a three-day run of gains, ahead of data expected to illustrate declining car sales and as investors contended with underlying anxiety before Friday's jobs report.

"Friday's jobs report should show non-farm payrolls down 550,000 and the rate above 7%," said Tom di Galoma, managing director of U.S. bond trading at Jefferies & Co. Inc.

After closing at an eight-week high Friday, the Dow Jones Industrial Average was down 52.88 points to 8,981.81.

Two-thirds of the Dow's 30 components traded in the red, with Verizon Communications Inc. fronting the declines, its shares lately off 6.5% in the wake of its downgrade by Bernstein Research.

Shares of J.P. Morgan Chase & Co. also slumped, down 3.8% after Deutsche Bank cut its estimates on the bank. .

The S&P 500 shed 1.42 points to 930.38, with telecommunication services, health care and financials the leading laggard sectors among the index's 10 industry groups.

Among the S&P's gaining sectors, energy proved the most robust, led by Peabody Energy Corp. and Consol Energy Inc. , both up more than 9%.

The Nasdaq Composite declined 6.21 points to 1,626.00, with tech stocks dipping even as Apple Inc. shares rose after CEO Steve Jobs acknowledged health problems but said he would stay on as the company's chief executive. .

Shares of Apple Inc. gained 3.3% after Jobs said he is undergoing treatment for a hormone imbalance that has caused him to lose weight. Jobs made his comments in an open letter to the Apple community. .

On Capitol Hill, President-elect Barack Obama plans to meet Monday with congressional leaders of both parties as he tries to shore up support for his economic-stimulus package and about $300 billion in tax cuts. .

Volume on the New York Stock Exchange neared 389 million, and advancing issues overtook those declining nearly 3 to 2. On the Nasdaq, nearly 224 million shares traded, and decliners edged just ahead of advancers.

Driven

End-of-the-year results from the auto industry were likely to be grim, with car-buying research Web site Edmunds.com looking for Chrysler to tally a 46% sales drop last month, while predicting General Motors Corp. and Ford Motor Co. will fall 39% and 34%, respectively.

Less grim than anticipated, the Commerce Department reported construction spending fell 0.6% in November.

J.P. Morgan raised its rating on Amazon.com Inc. to overweight from neutral. Shares of the online retailer were off 0.9%.

Oil futures gained more than 2% in early trade, with the contract for February delivery up 89 cents to $47.23 a barrel.

The dollar index , a measure of the greenback against rival currencies, held steady at 82.85. .

Treasury prices mostly advanced after the Federal Reserve said it had begun buying mortgage-backed securities. .

Overseas, Asian markets shot higher, with Japanese stocks taking the lead.

European shares also gained, with telecom, utility and oil equities among the strongest performers. .

By Kate Gibson