Equities fell back on profit taking Monday after last week's gains. A selloff in megacaps paced the declines. The Dow Jones industrial average slipped 0.8 percent, the S&P 500 lost 1.3 percent, and the NASDAQ was down 2.0 percent. US Treasury yields and the dollar rose while oil prices declined.

Rising bond yields added to the selling pressure, especially in growth stocks. Government bond markets sold off before the US open after higher than expected Spanish consumer price figures appeared to raise the odds of a 50 basis point rate move from the European Central Bank this week and again at its mid-March meeting. Caution ahead of this week's central bank meetings including the Federal Reserve on Wednesday, limited risk appetite.

Defensive plays held up best. Among sectors, energy stocks were among the day's weakest as oil prices slipped. Other laggards included parcels & logistics, internets, software, chipmakers, autos, and travel & tourism. Holding up best were food, cosmetics, department stores, health care, and telecom.

Market Reflections track market reaction to the trading day's major events. Economic data, policymaker speeches, and company news are featured in this report as well as key indexes and financial instruments.

Understanding why markets respond as they do is fundamental for an investor. Market Reflections help explain how the day's events, news, and data impact the outlook for the economy and for market prices.