Stocks edged up Monday with gains focused among Magnificent Seven stocks and a late selloff to end at the day's lows. The Dow Jones industrial average was flat, the S&P 500 firmed 0.1 percent and the Nasdaq was up 0.4 percent. US Treasury yields, oil prices and the dollar all declined. The Nasdaq and S&P managed record closing highs.

Megacaps including Alphabet advanced on expectations for strong earnings news this week. Apple and Amazon rose to boost the major indexes. Optimistic comments from Commerce Secretary Howard Lutnick about prospects for a trade pact with the European Union bolstered market sentiment and hopes for cooling in trade disputes generally. A late bout of profit-taking pushed prices down in the afternoon as some players took advantage of the market's recent run to take risk off.

Among sectors, communications services, consumer discretionary and materials outperformed while lagging were health care, industrials, financials and energy.

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.