Stocks were narrowly mixed Monday in choppy, uneventful trading with the prospect of a flareup in the Middle East hanging over the market. The Dow Jones industrial average declined 0.4 percent while the S&P 500 was flat and the Nasdaq firmed 0.2 percent. Oil prices rallied after Israel put its military on high alert and traders priced in an Iranian strike against Israel. Bond yields slipped as the U.S. Treasuries market extended its rally on Mideast fears while the dollar rose. The latest survey of consumer inflation expectations showed 1-year expectations unchanged and 3-year expectations down to record lows.

Last week's volatility shook up investors and uncertainty over the economic outlook appears high after mixed economic reports over the last few weeks, and ahead of another round of tier-one reports this week. Investors are focusing on producer price figures due Tuesday, consumer price figures due Wednesday and retail sales on Thursday. There is also a sprinkling of Federal Reserve speakers ahead, starting with Atlanta Fed President Raphael Bostic on Tuesday afternoon.

Among sectors, big technology stocks were mixed Monday with AI champion Nvidia up strongly on an analyst upgrade. Apple and Microsoft edged but Alphabet, Amazon and Meta lost ground. Energy stocks outperformed with the oil price rally. Other winners included industrial metals, precious metals, defense, and exchanges. Lagging were small caps, autos and auto suppliers, health & personal care, transports, food, credit cards and regional banks.

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.