A sharp sell-off in energy companies has pulled US stock indexes modestly lower, wiping out small gains from the day before.
Another slide in crude oil prices weighed on the energy sector. Banking, health care and technology companies also declined, while consumer-focused stocks and phone companies posted gains.
Investors mostly focused on company earnings from retailers, restaurant chains and other companies.
"We're still down year-over-year for the quarter, but there's a growing conviction that the headwinds from the energy bust and strong dollar are increasingly fading," said David Lefkowitz, senior equity strategist at UBS Wealth Management Americas.
The Dow Jones industrial average fell 37.39 points, or 0.2%, to 18,495.66. The Standard & Poor's 500 index shed 6.25 points, or 0.3%, to 2,175.49. The Nasdaq composite index lost 20.90 points, or 0.4%, to 5,204.58.
In the absence of major economic news, in what is a seasonally slow period for the markets, investors have been monitoring company earnings for clues about how the second half of the year is shaping up for corporate America.
A strong jobs report last Friday boosted investors' confidence in the US economy. Traders are looking ahead to Friday, when the US government delivers its latest monthly retail sales figures.
Most companies have already delivered their quarterly report cards, and earnings and revenue have been relatively good. Some 90% of the companies in the S&P 500 index have already reported second-quarter results, and roughly 65% posted earnings that beat Wall Street's expectations, according to S&P Global Market Intelligence.
Even so, earnings overall are expected to be down 2.1%, dragged down by the energy sector, which has been struggling with a steep drop in oil prices.
A report showing a bigger-than-expected increase in US oil stockpiles last week weighed on the price of crude, reversing an early gain.
Benchmark US crude fell 1.06 dollars, or 2.5%, to close at 41.71 dollars per barrel in New York. Brent crude, used to price international oils, slid 93 cents, or 2.1%, to close at 44.05 dollars per barrel in London.
Several companies reported disappointing quarterly results and gloomy outlooks.
Michael Kors slid 2.8% after the clothing company forecast weaker sales for the current quarter and lowered its outlook for sales at established stores. The stock fell 1.40 dollars (£1) to 48.71 dollars (£37.47).
Perrigo sank 9.6% after the pharmaceuticals company cut its guidance for the year, citing growing competition and falling prescription drug prices. The stock lost 9.09 dollars (£6.99) to 86 dollars (£66).
Traders sought shade from SunPower after the solar products and service company tumbled 30.2%. The company said its power plant business is struggling amid growing competition and project delays. The stock lost 4.47 dollars (£3.43) to 10.31 dollars (£7.90).
Investors bid up shares in several companies that reported strong earnings.
Yelp jumped 12.8% after the online business review portal reported strong quarterly results. The stock added 4.19 dollars(£3.22) to 36.83 dollars (£28.33).
Clothing company Ralph Lauren surged 8.5% after it too delivered strong quarterly results. The stock gained 8.07 dollars (£6.20) to 103.14 dollars (£79.35).
"The earnings beats that we're getting are, to a large extent, being driven by better revenue performance," Mr Lefkowitz said.