Highlights
Equities edged up late Monday to end slightly better after last week's losses. The Dow Jones industrial average firmed 0.2 percent, the S&P 500 gained 0.3 percent, and the Nasdaq was up 0.4 percent. Bond yields and the dollar rose while oil prices rallied.
Big technology shares had a decent day to support the major averages as investors remain focused on the artificial intelligence trade, with chipmakers outperforming. Apple, however, was a weight on the market as investors were unimpressed with the iPhone maker's announcement about its AI plans. Rising bond yields were another negative. U.S. Treasuries tracked overseas bond markets lower at the open and suffered more after the day's 3-year note sale attracted weak demand, which renewed concern about market appetite for a heavy slate of Treasury offerings.
Rising oil prices helped energy shares outperform as oil traders bought last week's dip. Other winners included homebuilders, housing-linked retail, pharma, truckers, hospitals and credit cards. Lagging were materials, banks, restaurant chains, aerospace & defense, food & beverage, and auto parts.
Investors are awaiting the week's big macro news events consumer prices and the Federal Reserve policy announcement, both due Wednesday, and producer prices and jobless claims due Thursday. CPI is seen cooling to a gain of 0.1 percent in May from 0.3 percent in April, with core CPI at 0.3 percent in May after rising the same 0.3 percent in April. On the Fed policy outlook, markets are keying on the Fed's dot plot projections and generally expect rate cuts in November and December.
Big technology shares had a decent day to support the major averages as investors remain focused on the artificial intelligence trade, with chipmakers outperforming. Apple, however, was a weight on the market as investors were unimpressed with the iPhone maker's announcement about its AI plans. Rising bond yields were another negative. U.S. Treasuries tracked overseas bond markets lower at the open and suffered more after the day's 3-year note sale attracted weak demand, which renewed concern about market appetite for a heavy slate of Treasury offerings.
Rising oil prices helped energy shares outperform as oil traders bought last week's dip. Other winners included homebuilders, housing-linked retail, pharma, truckers, hospitals and credit cards. Lagging were materials, banks, restaurant chains, aerospace & defense, food & beverage, and auto parts.
Investors are awaiting the week's big macro news events consumer prices and the Federal Reserve policy announcement, both due Wednesday, and producer prices and jobless claims due Thursday. CPI is seen cooling to a gain of 0.1 percent in May from 0.3 percent in April, with core CPI at 0.3 percent in May after rising the same 0.3 percent in April. On the Fed policy outlook, markets are keying on the Fed's dot plot projections and generally expect rate cuts in November and December.
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.
