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The Nasdaq composite closed lower on Monday as oil prices jumped nearly US$2 a barrelafter attacks on a Saudi airport, and investors waited for banks to kick off the third-quarter earnings season and for economic data this week.
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The S&P 500 closed nearly flat while the Dow was higher.
Oil futures rallied after deadly strikes on Riyadh's international airport over the weekend. The attacks overshadowed the prospect of increased supplies after US President Donald Trump hailed fresh Russian diesel exports and talked about a Russia-Ukraine ceasefire on energy targets.
In coming days, US investors will focus on corporate earnings, with major US banks including Goldman Sachs GS.N, Citigroup C.N and JPMorgan Chase JPM.N reporting early on Tuesday. Analysts were expecting S&P 500 earnings to surge 30.6% in the third quarter, according to LSEG IBES data.
Also due out this week are September readings for US consumer and producer inflation data as well as retail sales data. While the US Treasury market was closed on Monday for Columbus Day, stock investors have been wary of bond yields' recent advance to 24-year highs as elevated energy prices have stoked inflation concerns.
"Looking out further in the week, we have some big economic reports," said Tim Ghriskey, senior portfolio strategist at Ingalls & Snyder in New York. He said investors were cautious due to a lack of direction from bonds.
"We're also waiting on earnings and that's significant. The four large banks reporting on Tuesday can have a big impact," he said.
According to preliminary data, the S&P 500 .SPX lost 3.75 points, or 0.05%, to end at 7,807.79 points, while the Nasdaq Composite .IXIC lost 120.17 points, or 0.44%, to 27,246.00. The Dow Jones Industrial Average .DJI rose 198.22 points, or 0.38%, to 51,853.17.
"There's a lot to be wary of," said Robert Pavlik, senior portfolio manager at Dakota Wealth in Fairfield, Connecticut, pointing to upcoming data and earnings along with rising oil prices.
"You're walking down a train line and you don't know, because it's dark, if a train is coming and so, you know, you're just being real careful," he said.
With oil prices rising, energy .SPNY outperformed the S&P 500's major industry sectors during Monday's session. The S&P 500 communication services index .SPLRCL also rose with a boost from Meta META.O.
Technology .SPLRCT and consumer discretionary .SPLRCD were laggards. Technology's weakness was most pronounced among chip stocks with the Philadelphia semiconductor index .SOX losing ground and hitting a three-week low.
In consumer discretionary, Chipotle Mexican Grill CMG.N shares fell after Starbucks SBUX.O said it was not buying the burrito chain.
Microsoft MSFT.O was up 0.9%. Earlier, its market capitalization rose above US$4 trillion for the first time in a year after itannounced plans for major deployment of its own AI chips.
Salesforce CRM.N shares rose after BofA Global Research upgraded the stock to "buy" from "underperform." Also eBay EBAY.O rose after Morgan Stanley added the stock to its top-pick list.
Meanwhile, Cleveland Federal Reserve President Beth Hammack said the US central bank should move "relatively quickly" to a more restrictive monetary policy stance to fight inflation, which she feels has become more broad-based and is starting to influence firms' price-setting plans.
Traders were pricing in a less than 22% chance the US Federal Reserve will hike interest rates this month, according to CME's FedWatch tool, up from 17.7% on Friday.
Reuters
