Major US stock indexes finished slightly lower on Monday as Wall Street awaits updates on inflation and how US consumers feel about the economy.
The S&P 500 fell 0.2%. The benchmark index was coming off a holiday-shortened week in the US and its fourth consecutive week of gains. The Dow Jones Industrial Average also closed down 0.2%, while the Nasdaq composite fell 0.1%.
In total, the S&P 500 fell 8.91 points to 4,550.43. The Dow Jones fell 56.68 points to 35,333.47 and the Nasdaq lost 9.83 points to 14,241.02.
Health care, communications services and industrial stocks were among the market's biggest drags. Eli Lilly & Co. fell 1.6%, Meta Platforms fell 1% and Union Pacific closed 2% lower.
Technology stocks and companies that rely on consumer spending were bright spots. Chipmaker Nvidia rose 1% and Amazon.com gained 0.7%.
Shopify rose 4.4% after the cloud-based commerce company announced a record Black Friday global sales of $4.1 billion from its merchants.
In the bond market, Treasury yields fell broadly. The yield on the 10-year Treasury bond, which influences interest rates on mortgages and other loans, fell to 4.39% from 4.47% on Friday. The two-year Treasury yield fell from 4.95% to 4.88%.
Stocks closed mostly lower in Asia and Europe.
Investors have become cautiously optimistic that inflation has cooled enough for the Federal Reserve to permanently end its aggressive interest rate hikes. Meanwhile, the overall economy has remained strong enough in the face of rising interest rates and inflation to avoid a recession.
The markets have recovered thanks to that sentiment and the S&P 500 remains on track to close November as its best month of the year. Investors will get more updates on the economy this week to help confirm or soften that sentiment.
On Tuesday, the Conference Board releases its latest report on consumer confidence, which has remained strong all year. Economists surveyed by FactSet expect another strong reading for the October report.
The price of US crude oil fell 0.9% on Monday, remaining broadly stable ahead of Thursday's OPEC meeting. The cartel has kept supply tight, although prices have been falling over the past month. Lower energy prices could further ease inflationary pressure on consumers and help boost economic growth.
On Thursday, Wall Street will closely monitor October government data on the Federal Reserve's preferred measure of inflation. Economists expect this measure to continue to become more flexible, as it has done since mid-2022.
Investors have put the latest round of surprisingly good corporate earnings behind them, following several disappointing quarters. The main focus until the end of the year will be on the Federal Reserve and what it does next.
The Federal Reserve has held its benchmark interest rate steady in a range of 5.25% to 5.50% since its last quarter-point increase at its July meeting. Wall Street is betting the rate will remain stable at the central bank's December meeting and into early 2024, according to CME's FedWatch tool.
Investors are increasingly leaning toward the Federal Reserve cutting rates in mid-2024, cutting them from their highest level in two decades. However, the central bank has said it will make upcoming decisions based on the latest economic reports in its continued effort to cool inflation without slowing economic growth to the point of causing a recession.
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