Traders work on the floor of the New York Stock Exchange during morning trading in New York City.
Michael M. Santiago | Getty Images
Stocks struggled Monday as rising oil prices and higher Treasury yields weighed on market sentiment.
The Dow Jones Industrial Average dropped 398.51 points, or 0.94%, ending at 41,954.24. The S&P 500 slid 0.96% to 5,695.94, and the Nasdaq Composite lost 1.18% to close at 17,923.90.
The benchmark 10-year Treasury yield rose more than 4 basis points to 4.02%. That marks the first time since August that the yield topped 4%. Oil prices also rose as tensions in the Middle East remain high. U.S. crude climbed more than 3% to settle above $77 per barrel.
Monday’s moves come after a bumpy week for stocks that saw the major averages grind out modest gains. The S&P 500 added 0.2% for the week, while the Nasdaq Composite inched up 0.1% and the Dow added 0.1%.
“You’re coming off a week that was saved by the jobs report on Friday. The two things I think investors are watching with the most caution here are the yields of Treasurys are inching back up and … you’ve got energy prices creeping higher,” said Art Hogan, chief market strategist at B. Riley Wealth.
“Both those things probably have investors sort of looking at this and saying, ‘I wonder if this gets worse before it gets better,’ and we don’t think it will,” he added. “It’s certainly a reason to be cautious into the start of an earnings report season.”
Energy stocks, up about 0.4%, were the only sector in the S&P 500 to close in positive territory. The utilities and consumer discretionary sectors were among the benchmark’s laggards, both down around 2%.
Key releases in the week ahead include the Federal Reserve meeting minutes on Wednesday and the consumer price index report on Thursday. Earnings season also starts to heat up, with results from Delta Air Lines and JPMorgan Chase due out Thursday and Friday, respectively.
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