NEW YORK (Reuters) – U.S. stocks closed lower on Monday, slipping from last week’s record levels, as investors awaited guidance from first-quarter earnings to justify high valuations, while Tesla Inc shares fell after a fatal car crash.
The electric-car maker slid 3.4% after a Tesla vehicle believed to be operating without anyone in the driver’s seat crashed into a tree on Saturday north of Houston, killing two occupants.
The stock was the biggest drag on the S&P 500 and Nasdaq Composite Index. An 8.4% drop over the weekend in bitcoin, in which Tesla has an investment, also weighed on its share price.
The S&P 500 was mostly lower, with Microsoft Corp, Amazon.com Inc and Nvidia Corp also weighing on the benchmark index as analysts await results this week and next that form the bulk of earnings season.
Corporate outlooks should indicate to what degree the rally from last year’s lows can continue. Analysts expect first-quarter earnings to have grown 30.9% from a year ago, according to Refinitiv IBES data.
The U.S. economy is poised to boom as consumers hold $2 trillion in savings in excess of pre-pandemic levels, said Doug Peta, chief U.S. investment strategist at BCA Research, adding markets are in pause mode.
“If indeed we do keep grinding higher that would be healthy, that would suggest that the grinding higher is sustainable,” Peta said. “The pullbacks along the way are healthy.”
Real estate was the only one of the 11 S&P 500 sectors to post gains.
Nvidia fell 3.5% after the UK government said it would look into the national security implications of Nvidia’s purchase of British chip designer ARM Holdings, raising a question mark over the $40 billion deal.
Coca-Cola Co rose 0.6% after the beverage maker trounced estimates for quarterly profit and revenue, benefiting from the easing of pandemic curbs and wide vaccine rollouts.