Stocks were mostly better Monday with gains fueled by hopes for less sweeping import tariffs from the Trump administration and hopes for early action on tax cuts.

The Dow eased 0.1 percent, the S&P 500 advanced 0.6 percent and the Nasdaq rallied 1.2 percent. US Treasury yields rose among longer maturities and declined among shorter maturities. Oil prices and the dollar declined.

A report in The Washington Post that Trump was considering limiting threatened tariffs to key sectors gave the short end of the US Treasuries market a lift and boosted equities. The market faded after Trump denied the report. Investors see a less aggressive tariff policy as less inflationary and more likely to allow the Federal Reserve to cut interest rates. Trump's denial and an unfavorable reception for the Treasury 3-year note sale pushed yields higher. On the other hand, risk appetite drew support from reports the incoming administration will push for early action on a single reconciliation bill to extend expiring big tax cuts.

Megacaps and growth stocks were the day's best performers along with small caps. Chipmakers led the winners to boost technology shares, and communications services outperformed. Most other sectors were weaker.

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.