Stocks decline at start of busy week

Associated Press

NEW YORK

Stocks fell Monday as investors took a pause from a historic rally in September and held back ahead of a busy week of economic and earnings reports.

The Dow Jones industrial average lost nearly 80 points after factory orders fell slightly more than expected in August and contracts for new homes remained far below last year’s pace.

Analysts say the market was due for a pullback after a 10.4 percent gain in the Dow last month. The monthlong rally has come on relatively low volume, a sign that many investors still are waiting on the sidelines.

Doug Roberts, chief investment strategist at Channel Capital Research, said the market has been trading in a broad range over the past six months. With it approaching the high end of that range, a pullback is not surprising, he said.

The market has been “alternating between euphoria and despair,” Roberts said of the wide trading range dating back to late April, when stocks hit their high for the year.

This week brings a number of potentially important news events for stocks, including Friday’s monthly jobs survey and earnings on Thursday from Dow industrials component Alcoa Inc., a report that marks the traditional kickoff to the quarterly earnings season.

France’s Sanofi-Aventis launched an $18.5 billion hostile takeover offer for Genzyme Corp. Sanofi-Aventis’ previous offer was rejected by Genzyme’s board, so it is taking the offer directly to shareholders. The offer, at $69 per share, is unchanged from Sanofi-Aventis’ original offer in July.