Stocks slid on Monday as investors questioned the strength of an economic recovery, while energy shares were dragged down by lower oil prices.
After a sharp three-month rally, indexes have eased as traders increasingly questioned if stocks are due for a correction. Worries that the economic recovery could be tepid have wilted the optimism that drove the S&P 500 up by as much as 40 percent from the 12-year low in March.
Exxon Mobil Corp
While higher oil prices can be a boon for energy companies, rising prices can force consumers to further curb spending, potentially stalling any budding stabilization.
While the worst might be over, it doesn't mean we're off to strong growth in any of the major economies globally, said Alan Lancz, president of Alan B. Lancz & Associates Inc in Toledo, Ohio.
The World Bank said prospects for the global economy remain unusually uncertain as it cut 2009 growth forecasts for most economies.
The Dow Jones industrial average <.DJI> fell 109.66 points, or 1.28 percent, to 8,430.07. The Standard & Poor's 500 Index <.SPX> gave up 15.93 points, or 1.73 percent, at 905.30. The Nasdaq Composite Index <.IXIC> lost 36.54 points, or 2 percent, to 1,790.93.
The S&P 500 is still up nearly 34 percent from the March trough.
On the Nasdaq, Gilead Sciences Inc
But over the weekend it was reported Apple Chief Executive Steve Jobs had a liver transplant about two months ago. Jobs is expected to return to work later this month.
Investors are also cautious ahead of a Federal Reserve meeting that starts on Tuesday, bracing for Fed guidance on growth and any hints on expanding the central bank's $300 billion program of Treasuries purchases.
(Reporting by Leah Schnurr; editing by Jeffrey Benkoe)