Highlights
Equities rebounded to close slightly better Monday after an initial selloff on risk-off sentiment in response to the surprise Hamas attack against Israel. The Dow Jones industrial average rose 0.6 percent while the S&P 500 rose 0.6 percent and the Nasdaq firmed 0.4 percent. US Treasury yields did not trade while the dollar rose and oil prices surged.
Federa;l Reserve speakers appeared generally supportive for risk appetite Monday as they have taken up the refrain that tighter financial conditions are doing much of the Fed's work in slowing the economy. Stocks rebounded after the initial shock of the news from the Middle East as the market has tended to downplay geopolitical news and the conflict appeared limited so far in scope. That perception would change if Iran becomes more explicitly involved in the conflict or any powers from outside the region.
Among sectors, energy stocks advanced with a big move higher in oil prices amid worries that the conflict would affect flows of oil from the Middle East. Defense contractors also outperformed. Big technology shares had a good day along with drug stores, grocery stores, managed care, trucking, and chemicals. Lagging were airlines, department stores, banks, chipmakers, autos, and health & personal care stocks.
Federa;l Reserve speakers appeared generally supportive for risk appetite Monday as they have taken up the refrain that tighter financial conditions are doing much of the Fed's work in slowing the economy. Stocks rebounded after the initial shock of the news from the Middle East as the market has tended to downplay geopolitical news and the conflict appeared limited so far in scope. That perception would change if Iran becomes more explicitly involved in the conflict or any powers from outside the region.
Among sectors, energy stocks advanced with a big move higher in oil prices amid worries that the conflict would affect flows of oil from the Middle East. Defense contractors also outperformed. Big technology shares had a good day along with drug stores, grocery stores, managed care, trucking, and chemicals. Lagging were airlines, department stores, banks, chipmakers, autos, and health & personal care stocks.
Definition
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.
Description
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.
