Stocks fell for a third straight session Monday as oil prices soared to new highs after the U.S. embassy in Saudi Arabia said it would be closed for two days because of security threats.
Wall Street retreated when crude prices jumped on the New York Mercantile Exchange following the U.S. embassy's warning that there was a "threat against U.S. government buildings in the kingdom." It was the second alert from the embassy in two weeks.
Before oil surged, acquisition news catapulted stocks in the opening minutes of trading. E-Trade Financial and Quest Diagnostics said they are buying rivals, and a British newspaper reported that Cisco Systems may bid for cell phone maker Nokia.
Investors were also worried about Tuesday's meeting of Federal Reserve policymakers, who are expected to raise the short-term federal funds rate by a quarter percentage point to 3.5 percent -- the 10th hike since last summer.
The Dow Jones industrial average fell 21.10, or 0.2 percent, to 10,536.93. The Standard & Poor's 500-stock index slid 3.29, or 0.3 percent, to 1223.13, and the Nasdaq composite index dropped 13.52, or 0.6 percent, to 2164.39.
Quest Diagnostics rose $1.71, to $49.21. The nation's top provider of medical tests said it is planning to acquire LabOne in a $934 million deal that will expand Quest's share of the testing market.
Cisco Systems fell 5 cents, to $19.25, after the British newspaper Business reported Cisco is considering buying a wireless company, and that Nokia had been identified as the most likely target. Nokia rose 14 cents, to $16.08.
Kerr-McGee, an oil and gas producer, rose $3.03, to $85.01, after reports that it is nearing a deal to sell its North Sea oil assets for about $3.5 billion.
Whirlpool rose $2.75, to $82.46, after submitting a binding offer to acquire Maytag for $20 per Maytag share, up from an earlier offer of $18 a share and 43 percent higher than a deal Maytag had agreed to with a private-equity firm. Maytag rose $1.60, to $18.58.
Delphi rose 7 cents, to $5.03, despite falling to a second-quarter loss from a year-ago profit. The nation's biggest auto-parts maker also said it will consider filing for bankruptcy protection.
New York Stock Exchange composite index fell 0.58, to 7452.71.
American Stock Exchange index fell 0.03, to 1630.51.
Russell 2000 index of smaller-company stocks fell 3.19, to 659.60.
NYSE: 1.8 billion shares, down from 1.93 billion on Friday. Decliners outnumbered advancers 5 to 3.
Nasdaq: 1.47 billion shares, down from 1.49 billion. Decliners outnumbered advancers 3 to 2.
Crude oil for September delivery: $63.94, up $1.63.
Gold for current delivery: $434.70 a troy ounce, down from $437.20 on Friday.