NEW YORK -- U.S. stocks retreated, sending the Standard & Poor's 500 Index to its fifth drop in six sessions, as the continuing selloff in oil overshadowed a surge in industrial production and corporate deals.
The S&P 500 fell 0.6 percent to 1,989.63 at 4 p.m. in New York, falling below its average price for the past 50 days. The gauge lost as much as 1 percent on Monday, slipping below its 100-day moving average before paring the decline. It has lost 4.1 percent since closing at a record on Dec. 5.
The Dow Jones Industrial Average dropped 100 points Monday, or 0.6 percent, to 17,180.84. The measure plunged 3.8 percent last week, the biggest drop since November 2011. About 8.4 billion shares changed hands on U.S. exchanges, the highest volume since Oct. 17.
"People are going to come into these markets looking at the same things they did last week, oil and secondary interest rates," Randy Frederick, managing director of trading and derivatives at Charles Schwab, said by phone from Austin, Texas. "To me, the oil sell off is a bit overdone and people's reactions are a bit negative to it. We need to see stability in oil that lasts a couple of days. If we get that, people will stop being concerned."
The S&P 500 erased an early advance of 0.8 percent Monday as crude reversed gains. The benchmark stocks index then fell as much as 1 percent by midday before paring losses. The gauge lost 3.5 percent last week as crude plunged to a five-year low.
West Texas Intermediate lost 4.3 percent to $55.30 a barrel Monday. Oil has tumbled 16 percent this month after the Organization of Petroleum Exporting Countries cut its forecast for how much crude it will need to provide in 2015 and the International Energy Agency forecast weaker consumption and increased supply from countries outside of OPEC.
"This is a continuation of the past three or four trading days," Joe Bell, a Cincinnati-based senior equity analyst
at Schaeffer's Investment Research, said by phone. "Every time we've had a rally, we've finished near the low of the day."
The S&P 500 pared gains of 1.45 percent Dec. 11 to close the day up 0.5 percent. The next day, U.S. equity losses picked up speed in the final hour as the Dow average plunged more than 100 points and the S&P 500 ended down 1.6 percent, about 2 points above its average price for the last 50 days, a level monitored by technical analysts.
Equities opened higher Monday as a report showed industrial production surged in November by the most since May 2010 as U.S. assembly lines churned out more consumer goods and business equipment, signaling manufacturing is bolstering economic growth.
The 1.3 percent gain in output at factories, mines and utilities followed a 0.1 percent increase the prior month that was previously reported as a decline, figures from the Federal Reserve showed. Manufacturing rose 1.1 percent, the most in nine months, and output at utilities was the strongest in almost eight years.
Investors are also waiting for the Fed's update on the timing and pace of interest-rate increases. Policy makers may decide on Dec. 17 whether to keep their pledge to hold interest rates low for a considerable time.
The Chicago Board Options Exchange Volatility Index, also known as the VIX, jumped 78 percent in the past five days, its biggest advance in more than four years. The gauge jumped as much as 18 percent and lost as much as 16 percent Monday.
All 10 main industries in the S&P 500 declined. Financials and utilities shares dropped more than 0.8 percent to lead losses, while telephone and industrial stocks performed the best.
Among U.S. stocks moving Monday, PetSmart rose 4.3 percent after a group led by BC Partners agreed to buy it for $8.3 billion. Emerson Electric Co. gained as much as 1.9 percent after selling a power-transmissions business to Regal-Beloit for $1.4 billion. The stock later pared gains to close down 0.5 percent.
McDonald's, Goldman Sachs Group, International Business Machines and Chevron lost more than 1.4 percent for the biggest declines in the Dow.
Boeing rose the most in the 30-stock gauge, adding 1.1 percent. It extended gains in late trading after saying it would boost its share buyback program and increase its dividend.
Energy shares in the S&P 500 slid 0.7 percent after gaining in early trading, with 34 members declining while nine rose. Chevron dropped 1.5 percent, while QEP Resources slipped 3.8 percent and Marathon Oil retreated 2.6 percent.
Some of last week's worst performers gained the most Monday. Nabors Industries Ltd. rose 2.8 percent Monday after declining 18 percent last week. Exxon Mobil rose 0.6 percent, following a 7.7 percent plunge last week that was its worst since 2008.
Diamond Offshore Drilling climbed 5.6 percent, extending last week's rally of 12 percent.
Newmont Mining lost 5.9 percent for the biggest decline in the S&P 500 as gold for February delivery sank 2.1 percent to $1,196.70 an ounce.