By Anora Mahmudova and Barbara Kollmeyer, MarketWatch
NEW YORK (MarketWatch) -- The U.S. stock market moved decidedly lower Monday as excitement from a flurry of deal news, including the takeover of Family Dollar Stores Inc. by Dollar Tree Inc. proved unsustainable in lightof weak housing data.
Sales of existing home in June fell, marking the first decline in four months. Later this week, the pace of data speeds up as investors will get second-quarter gross domestic product, a Fed decision and July payrolls among other economic items of importance. Get ready for 48 hours of economic fury
The S&P 500 (SPX) declined by 8.6 points, or 0.5%, to 1,969.18. The Dow Jones Industrial Average (DJI) dropped 75 points, or 0.4%, to 16,885.53. The Nasdaq Composite (RIXF) lost 26 points, or 0.6% to 4,422.94.
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Fears of a bubble bursting won't rest, said Joao Monteiro, analyst at Valutrades. "This story may be looking a little over-brokered, but with the quiet summer sessions lying ahead, even just a small shock could be all it takes to precipitate a big move," he said in a note to clients. Also read: Stock trader who called three crashes sees 20% collapseGoldman Sachs on Friday cut its three-month view on global stocks to neutral, over concerns a temporary bond selloff could hit equities.
Mid-July, Goldman raised its year-end target for the S&P 500 index to 2,050 from 1,900, making the investment bank one of the most bullish on Wall Street.
"Merger Monday" began with a deal in the retail industry. Family Dollar Stores(FDO), soared 22% after Dollar Tree (DLTR) said it would buy the rival discount retailer for $74.50 a share, a roughly 23% premium over Family Dollar's closing price on Friday. Dollar Tree shares were up around 7.6%. Rival Dollar General Corp.(DG) fell 2.1%.
Shares in Zillow Inc (ZILLOW.XX) fell 3.5% after the real-estate website said it is buying a rival Turlia Inc(TRLA) for $3.5 billion in stock. Trulia jumped 12%.
El Pollo Loco Holdings Inc. (LOCO) surged 15%. The Mexican fast-food chain soared 60% in its Nasdaq debut on Friday.
Among Monday's earnings reports,Tyson Foods (TSN) posted earnings that missed Wall Street views, although revenue topped forecasts. Tyson shares rose 4%.
Herbalife Ltd. (HLF) will report after the close on Monday. Follow more of the day's notable movers here.
Across other markets, Hong Kong's Hang Seng Index closed at highs not seen in more than three years on Monday, after reports that a plan to allow direct stock trading between Hong Kong and Shanghai could be launched mid-October. European stocks had trouble making headway as U.S. stock futures leaned south.
Oil prices (CLU4) pushed lower, while gold (GCU4) was a touch higher, and the U.S. dollar index(DXY), which measures the greenback against a basket of six other currencies, was largely steady.
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(END) Dow Jones Newswires
July 28, 2014 10:49 ET (14:49 GMT)
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