U.S. stocks fell on Monday as a resurgent U.S. dollar took a toll on commodity prices and investors paused to gauge if the outlook for corporate profits justified the market's recent run to 11-month highs.

A weaker-than-expected reading in a forward-looking measure of the U.S. economy added to the negative tone.

The Conference Board's August index of leading indicators rose 0.6 percent, a fifth straight monthly increase, but shy of the 0.7 percent forecast by economists.

It's maybe a tad weaker than expected. But for stock prices, it's not going to change the overall direction, where stocks were a bit overbought here, looking for a modest pullback, said Steve Goldman, market strategist at Weeden & Co in Greenwich, Connecticut.

Through Friday the benchmark S&P 500 had risen 58 percent since hitting a 12-year closing low in early March, partly because of strong second-quarter earnings and optimism that an economic recovery is gaining traction.

That optimism is beginning to come under some strain, however, as investors seek more clarity about the 2010 profit outlook and await hints of how strong results will be for the rest of this year.

The Dow Jones industrial average <.DJI> shed 67.41 points, or 0.69 percent, to 9,752.79. The Standard & Poor's 500 Index <.SPX> lost 7.60 points, or 0.71 percent, to 1,060.70. The Nasdaq Composite Index <.IXIC> declined 7.06 points, or 0.33 percent, to 2,125.80.

Caterpillar Inc , down nearly 2 percent, was among the top drags after the maker of bulldozers, excavators and other products said worldwide August sales of machinery to dealerships fell.

Crude oil futures shed 3.8 percent to $69.30 a barrel, and spot gold prices dropped below $1,000 an ounce. The S&P materials <.GSPM> index fell 2 percent.

Shares of Exxon Mobil Corp declined 1 percent to $69.28, while gold miner Newmont Mining Corp shed 2.7 percent to $43.77.

The Nasdaq's losses were curbed by a rise in biotechnology companies after a brokerage raised its rating on Celgene Corp , up 5 percent at $55.20.

Computer maker Dell Inc announced a $3.9 billion proposed takeover of Perot Systems Corp
. Perot Systems shares jumped 65.3 percent to $29.61, while Dell shares dipped 5.1 percent to $15.83.

Any benefit from that announcement, however, was tempered by the rising U.S. dollar. The dollar index, which measures the greenback against a basket of major currencies, rose 0.7 percent. <.DXY>

(Additional reporting by Chuck Mikolajczak; Editing by Padraic Cassidy)