MarketView for April 7

Summary

Monday was certainly not a fruitful day on Wall Street with the S&P 500 chalking up its largest three-day decline in two months, as investors sold off Internet stocks and rotated into defensive names to protect against further declines.

As a result, internet stocks were among the day's largest decliners with Amazon.com down 1.6 percent at $317.76 and Yahoo! falling 3.5 percent to close at $33.07. The Global X Social Media ETF, which includes Groupon and LinkedIn, fell 2.5 percent. However, the biotechnology sector, which saw sharp declines in the past several sessions, ended higher with the Nasdaq biotech sector index up 0.5 percent at 2,367.94.

Selling pressure migrated to other sectors, with only defensives such as utilities and consumer staples in positive territory among the 10 major S&P sectors.

The CBOE Volatility index VIX, often used to gauge investor sentiment on Wall Street rose 11.5 percent to 15.56. The index usually moves inversely to the S&P 500.

Dish Network was among the day’s top decliners on the Nasdaq 100 down 4.4 percent at $59.51.

Pfizer, down 3 percent to $31.20, added pressure to the Dow Jones Industrial Average and the S&P 500 indexes. The company's experimental breast cancer drug in a clinical trial nearly doubled the amount of time patients lived without their disease getting worse, but overall survival was not yet shown to be statistically significant, researchers said.

Earnings season gets under way this week, with results due from financials JPMorgan Chase and Wells Fargo, as well as Bed, Bath & Beyond.

S&P 500 companies' first-quarter earnings are projected to have increased just 1.2 percent from a year ago. The forecast is down sharply from the start of the year, when growth was estimated at 6.5 percent.

A lackluster first-quarter earnings season hurt by a harsh winter could spark a pullback, with investors more optimistic for the second quarter.

Specialty pharmaceuticals company Mallinckrodt agreed to buy drug manufacturer Questcor Pharmaceuticals for about $5.6 billion to gain access to its multiple sclerosis drug, Acthar Gel. Questcor shares climbed 18.7 percent to $80.58 while Mallinckrodt fell 2.5 percent to $60.95.

Approximately 7.5 billion shares changed hands on major equity exchanges, a number that was above the 6.6 billion share average so far this month, according to data from BATS Global Markets.