Equities recovered from midday lows to end barely higher Monday as the market focused on earnings news and concern over the federal debt limit extension. The Dow industrials, the S&P 500, and the Nasdaq all rose 0.3 percent. US Treasury yields and the dollar gained while oil prices dropped.

House Speaker Kevin McCarthy's appearance in New York focused the market's attention on the debt ceiling problem, and underlined how far apart the two sides are. Later Monday, speculation that McCarthy was prepared to move in the administration's direction spurred a flurry of buying but there was no evidence to support that view.

Stocks seesawed through the day in relatively narrow ranges as the market lacked conviction ahead of more big earnings news. Company results so far, starting with financials, have mostly been better than the market feared but positive response has been limited by rising expectations for more Federal Reserve rate increases and by valuation worries. A surprisingly strong report on regional manufacturing from the Federal Reserve Bank of New York Monday added to worries about rising rates.

Among sectors, best performers Monday included regional banks, homebuilders, real estate investment trusts, airlines, and aerospace & defense. Lagging were custody banks, including State Street, which sank on disappointing quarterly results. Other weak links included precious metals, energy, health care, and restaurants.

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.