Stocks on Wall Street ended the day with mixed results on Monday as oil prices fell. This came after a temporary pause in hostilities between the U.S. and Iran, allowing efforts to restart negotiations to end the conflict. The S&P 500 experienced a minor increase of less than 0.1% after fluctuating between gains and losses throughout the day. This marked the end of two consecutive weekly losses for the index.
The Dow Jones Industrial Average rose by 0.5%. However, the Nasdaq composite saw a decrease of 0.2%, marking its fourth consecutive loss. All three major indexes are facing the possibility of ending the month negatively. For the S&P 500 and Nasdaq, this would be the second successive monthly decline.
Oil prices have changed course from the previous week. The escalation in tensions between the U.S. and Iran had previously fueled worries over global oil supplies. Brent crude, a global benchmark, dropped by 6.3% to settle at $85.87 per barrel for October. U.S. crude oil for September delivery decreased by 7.5%, settling at $82.61 per barrel.
The conflict between the U.S. and Iran had significant economic repercussions, affecting the crucial Strait of Hormuz. This situation led to increased gasoline prices and rising shipping costs, which businesses often pass on to consumers.
Oil prices have decreased, easing tensions in the Middle East, but AI technology concerns are still influencing markets. European and Asian markets closed higher on Monday.
Bond yields also decreased. The 10-year Treasury yield dropped to 4.65% from 4.69% on Friday. Significant shifts in the market were largely influenced by technology companies. Nvidia dropped by 5%, and Micron Technology fell by 2.3%. Meanwhile, Microsoft gained 1.9%, and Apple increased by 1.2%. These major companies have substantial market valuations, which significantly influence market movement.
The mix of gains and losses among various companies contributed to market volatility, despite most S&P 500 companies gaining value. Stocks of communication companies were among Monday’s gainers. Alphabet, Google’s parent company, rose by 2.1%, Charter Communications jumped by 6.7%, and Comcast increased by 2.3%.
Credit card companies and payment processors also saw gains. American Express increased by 2.8%, Capital One Financial gained 2.1%, Visa rose by 1.9%, and Mastercard advanced by 2.2%.
In Asia, Chinese memory chipmaker CXMT made a significant debut in Shanghai, becoming China’s most valuable listed company with a market capitalization of approximately 3.3 trillion yuan, or nearly $490 billion.
The S&P 500 gained 1.20 points to 7,413.18. The Dow rose by 262.83 points to 52,210.08, while the Nasdaq dropped 43.74 points to 24,932.08.
Wall Street anticipates a busy week with significant economic updates and corporate earnings reports. Consumer confidence data is expected on Tuesday, and an inflation report is due Thursday.
Chris Larkin from E-Trade at Morgan Stanley emphasized the potential for surprises this week. Much attention is on the Federal Reserve, which will provide an update on Wednesday regarding its interest rate policy. The central bank has faced rising inflation due to the U.S. conflict with Iran and newly imposed U.S. tariffs worldwide.
Wall Street currently predicts a 36% probability of an interest rate hike in the Fed’s upcoming meeting. Higher rates curb inflation by making borrowing costlier and slowing economic growth. The Fed has maintained a steady interest rate throughout the year while monitoring inflation.
Persistent inflation continues to impact households, with elevated fuel costs straining budgets. This might lead to reduced spending on items like clothing and travel. Investors are scrutinizing corporate earnings for signs of consumer stress and assessing whether Wall Street’s yearlong stock surge is warranted by profits. Many companies are reporting earnings this week, which could reveal insights into different economic sectors. Companies like Sherwin-Williams, Boeing, and Visa are expected to report on Tuesday. Starbucks and Chipotle will release results on Wednesday.
Particular focus remains on technology companies due to their sharp gains this year contributing to Wall Street’s record performance. Microsoft will report on Wednesday, while Amazon, with growth in cloud services and AI, will report alongside Apple on Thursday.
AP Business Writer Elaine Kurtenbach contributed to this report.