Highlights
Stocks slipped again Monday as the Iran war dragged on and oil prices rose again. The Dow firmed 0.1 percent, the S&P 500 lost 0.4 percent and the Nasdaq fell 0.7 percent. Bond yields actually declined as the market increasingly sees a recession coming as a result of surging oil prices. Crude oil prices rose amid widening US and Israeli bombing strikes and the dollar was mostly higher.
A selloff in big technology shares was a notable part of the day's stock weakness with chip stocks lagging and industrials also leading the declines. News of new Israeli strikes on Iranian infrastructure fueled new oil price gains and added to stock weakness. Markets noted with interest somewhat equivocal comments from Federal Reserve Chair Jerome Powell who said the Fed was in position to wait to see what would be the economic fallout from the Iran war and rising oil prices. Markets reacted somewhat positively to President Trump's claim that negotiations were ongoing and less favorably to his threats to widen US attacks on Iranian infrastructure.
Among sectors, energy outperformed on rising oil prices again. Other winners included consumer discretionary, utilities, financials and materials.
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.