Stocks faced challenges on Monday as rising oil prices and increased Treasury yields dampened market sentiment.
The Dow Jones Industrial Average fell 398.51 points, or 0.94%, to close at 41,954.24. The S&P 500 decreased by 0.96%, settling at 5,695.94, while the Nasdaq Composite dropped 1.18% to finish at 17,923.90.
The benchmark 10-year Treasury yield rose more than 4 basis points, reaching 4.02%. This marks the first time since August that the yield has exceeded 4%. Oil prices also increased, driven by ongoing tensions in the Middle East, with U.S. crude climbing more than 3% to settle above $77 per barrel.
Monday’s movements followed a tumultuous week for stocks, during which major averages managed to achieve modest gains. The S&P 500 rose 0.2% for the week, while the Nasdaq Composite inched up by 0.1%, and the Dow added 0.1%.
Energy stocks, which were up about 0.4%, were the only sector in the S&P 500 to finish in positive territory. In contrast, the utilities and consumer discretionary sectors lagged, both declining around 2%.
Looking ahead, key releases include the Federal Reserve meeting minutes on Wednesday and the consumer price index report on Thursday. Earnings season is also set to gain momentum, with results from Delta Air Lines and JPMorgan Chase scheduled for Thursday and Friday, respectively.
In company news, Amazon shares fell 3.1% after Wells Fargo downgraded its rating from overweight to equal weight and lowered its price target, citing concerns over slowing growth and increased competition from Walmart.
Apple shares fell 2.25% after Jefferies lowered its rating on the megacap tech company from buy to hold, citing that near-term expectations for the iPhone 16 and 17 are overly optimistic due to weaker-than-expected initial demand.
Sources: Bloomberg, FactSet, IRESS, TradingView, UBS, Bourse Data, Trading Economics, CoinMarketCap, Marketech.
