US stocks barely moved on Monday as investors found few reasons to keep pushing shares higher after eight straight weeks of gains despite data pointing to stronger growth in manufacturing and construction spending.
The Institute for Supply Management (ISM) said its index of national factory activity rose to 57.3 in November - its best showing since April 2011 - from 56.4 in October, while the pace of hiring in the sector also accelerated.
In addition, construction spending increased 0.8% in October to an annual rate of $908.4 billion, the highest level since May 2009, as a rebound in public construction projects offset a drop in private outlays.
Earlier, financial data firm Markit said its final US Manufacturing Purchasing Managers Index rose to 54.7 in November, exceeding the preliminary October reading of 54.3.
Equities have rallied in recent weeks on expectations of continued stimulus from the Federal Reserve. The S&P 500 has risen for eight straight weeks, its longest run since a nine-week climb between November 2003 and January 2004, putting its yearly gain at nearly 27%.
Both the Dow and the S&P 500 have hit repeated all-time highs this year. "We're not expecting a severe pullback, but we're not jumping into the market with both feet, given how far we've come, and that there are no real catalysts," said John Norris, managing director of wealth management with Oakworth Capital Bank in Birmingham, Alabama.
While the Fed's stimulus program is expected to put a floor under equity prices for as long as it continues, market participants expect the central bank to begin scaling back its bond-buying program within the next few months, with many expecting an announcement in March.
The central bank has said it would begin to slow the program when certain economic measures meet its targets. The calendar is packed this week with data that may provide some insight, culminating with the November nonfarm payrolls report on Friday.
The Dow Jones industrial average was down 1.22 points, or 0.01%, at 16,085.32. The Standard & Poor's 500 Index was up 2.40 points, or 0.13%, at 1,808.21. The Nasdaq Composite Index was down 0.76 of a point, or 0.02%, at 4,059.13.
The Dow was pressured by 3M Co, which fell 2.7% to $129.86 after Morgan Stanley downgraded the stock to "underweight" from "equal weight." Retailers will stay in focus as the holiday shopping season ramps up. Heavy discounting took a toll on US retail sales during the Thanksgiving weekend as shoppers spent almost 3% less than they did a year earlier, according to an industry group.
"I'm not agonizing about the Black Friday numbers," Norris said. "There's still a lot of time before the season ends, and it should be stronger than last year since the market has been so good, and people have more money to spend."
The S&P retail sector index fell 0.5%, led lower by a 2.8% drop in Urban Outfitters to $37.90 after Sterne Agee cut its rating on the stock to "neutral." In the industrial sector, shares of Dow Chemical rose 2.6% to $40.09.
The stock advanced after the company identified the commodity chemicals businesses it would sell or spin off as part of a plan to sell assets worth $3 billion to $4 billion, representing up to $5 billion of total annual revenue.