Stocks on Wall Street fell for the time in five days as investors weighed a disappointing survey of New York manufacturers.

Stocks rallied last week after Federal Reserve Chairman Ben Bernanke announced an open-ended bond-buying programme meant to spur the economy.

The New York Federal Reserve Bank's Empire State business conditions index for September fell from a month earlier. Economists had expected the result to improve.

The Dow Jones Industrial Average declined 40.35 points, or 0.3%, to 13,3553.02 at the close. Last week it ended at its highest level since December 2007 on Friday.

The S&P 500 index gave up 0.3% to 1461.19, with the materials sector falling 1.2%, its biggest drop since early August.

JP Morgan analysts downgraded several steel-related stocks to "neutral" from "overweight," saying weak steel demand undercuts the shares' prospects.

Defensive sectors such as healthcare and telecommunications performed better.

The Nasdaq Composite Index lost 0.2% to 3178.67.

Other markets: Europe, Asia down
European markets lost ground. The Stoxx Europe 600 fell 0.3% to 275.01 after reaching a 15-month high on Friday.

The UK's FTSE 100 index shed 0.4% to 5893.52, Germany's DAX was 0.1% weaker at 7403.69 and France's CAC-40 fell 0.8% to 3553.69.

In Asia, China's Shanghai Composite slumped 2.1% as anti-Japan demonstrations tied to the countries' dispute over islands in the region intensified, leading to some factory shutdowns.

The Shanghai Composite fell by 2.1% to 2078.50 while Hong Kong's Hang Seng Index ended 0.1% up at 20658.11.

In Australia, the S&P/ASX 200 was up 0.3% to 4402.50 and Korea's Kospi Composite was off 0.3% to 2002.35.

India's Sensex index rose 0.4%, closing at a 52-week high, but pared gains after the central bank left its policy rate unchanged.

Japan's market was closed for a holiday.

Crude-oil prices fell 0.4%, to $US98.62 a barrel, while gold prices gave up 0.2%, to $US1,769.30 an ounce.

Currencies: Euro gains against US dollar, yen
The euro was at $US1.3126, compared with $US1.3130 late on Friday. It traded as low as $US1.3082 earlier.

The euro also rallied against the Japanese yen, buying ¥103.34 versus ¥102.85.

The dollar was at ¥78.73 from ¥78.39. The pound changed hands at $US1.6266 from $US1.6215, and the dollar was unchanged at 0.9260 Swiss franc.

The Wall Street Journal dollar index rose to 69.06 from 68.980.