Wall Street declined, sending the Standard & Poor's 500 Index down from its record high close on Thursday, after the latest headline manufacturing data fell short of expectations.
The Institute for Supply Management's index of national factory activity dropped to 51.3 in March, from 54.2 in February. The median forecast of 69 economists surveyed by Bloomberg projected the ISM's factory index would drop to 54.
Even so, Markit's US Manufacturing Purchasing Managers' Index posted 54.6 in March, up from February's 54.3 but down from the earlier flash estimate of 54.9.
"Manufacturers enjoyed another month of strong output and order book growth in March, finishing off the best quarter for two years," Chris Williamson, chief economist at Markit, said in a statement. "The sector will have provided a firm boost to the economy in the first quarter."
In afternoon New York trading, the Dow Jones Industrial Average fell 0.14 per cent, the Standard & Poor's 500 Index shed 0.53 per cent, while the Nasdaq Composite Index dropped 0.77 per cent.
Meanwhile, construction spending rose 1.2 per cent to an annual rate of US$885.1 billion in February following a 2.1-per cent drop the prior month.
Spending on private residential projects climbed to the highest level in more than four years.
Other reports eyed this week include factory orders, due Tuesday, the ADP employment report, due Wednesday, as well as March payrolls and international trade, both due Friday.
Last week the S&P 500 posted a 0.8 per cent advance and on Thursday finally closed at a fresh record high. Wall Street was closed on Good Friday. For the month of March, the Dow added 3.7 per cent, the S&P 500 gained 3.6 per cent while the Nasdaq advanced 3.4 per cent.
Markets in most of Europe were closed for both Good Friday and Easter Monday. Europe's benchmark Stoxx 600 Index slipped 0.1 per cent in the past four days.
Investors will eye a European Central Bank meeting on April 4. Policy makers are expected to keep the central bank's interest rate steady at a record low.
The Bank of Japan, under new Governor Haruhiko Kuroda, is also gearing up for a two-day policy meeting beginning on April 3. The central bank is expected to expand its asset-purchase program.
The Bank of Japan's quarterly Tankan survey for March, released on Monday in Tokyo, showed confidence among big Japanese manufacturers improved for the first time in three quarters, the gain fell short of than economists' estimates.
"The governor is expected to make good on his promise of pursuing bold monetary easing," Tatsushi Shikano, senior economist at Mitsubishi UFJ Morgan Stanley Securities in Tokyo, told Reuters. "The tankan result reflected companies' expectations that a weaker yen and policy steps pursued by the government will have a positive impact on the economy."
Talks about Dell's future continue. Founder Michael Dell will only consider backing a buyout by Blackstone Group if the private-equity firm guarantees he can remain as chief executive officer, Bloomberg reported, citing a person familiar with the discussions. Shares of Dell were last down 0.38 per cent to US$14.28.