The S&P 500 finished marginally lower on Monday as investors prepared for a busy week of corporate earnings and key inflation reports. The decline followed a positive week for Wall Street, supported by gains in technology stocks despite rising oil prices and Treasury yields.
The benchmark S&P 500 slipped 0.06% to close at 7,807.24. Meanwhile, the Dow Jones Industrial Average climbed 195.60 points, or 0.38%, to finish at 51,850.55, extending its winning streak to three sessions. The Nasdaq Composite fell 0.44% to settle at 27,245.90.
Technology stocks weighed on the Nasdaq, with Micron Technology shares dropping 3.9% amid concerns about intensifying competition from China's CXMT. The Chinese memory chip manufacturer recently reported progress on a new chip structure, prompting investors to reassess the competitive outlook for the memory chip industry.
The Dow received support from Salesforce, whose shares gained 2% after Bank of America upgraded its rating on the company twice, reflecting a more positive assessment of its prospects.
Geopolitical developments also remained in focus. President Donald Trump told reporters he was considering joining Saudi Arabia in its fight against Iran-backed Houthi forces in Yemen following another deadly attack on Riyadh's international airport. The comments raised concerns about a possible escalation of tensions across the Middle East, keeping investors attentive to potential disruptions in global energy markets.
Despite Monday's mixed performance, Wall Street ended the previous week on a positive note. The S&P 500 and Dow recorded their second weekly gains in three weeks, while the Nasdaq extended its winning streak to four consecutive weeks. A rally in technology shares helped investors absorb concerns over elevated oil prices and rising bond yields.
Investors are now looking to the third-quarter earnings season to provide fresh momentum for equities amid ongoing geopolitical uncertainty. According to FactSet analyst John Butters, S&P 500 companies are expected to deliver earnings growth of approximately 29.6% for the quarter. If achieved, this would mark the fourth consecutive quarter of earnings growth exceeding 25%, driven largely by continued investment in artificial intelligence infrastructure and data centers.
Earnings announcements from major U.S. banks are expected to take center stage this week. Bank of America, Citigroup, Goldman Sachs, JPMorgan Chase, Morgan Stanley and Wells Fargo are among the financial institutions scheduled to report results, offering investors insights into consumer activity, credit conditions and the broader economic outlook.
Inflation will also be a major focus, with September's Consumer Price Index (CPI) scheduled for release on Wednesday and the Producer Price Index (PPI) due on Thursday. The reports could influence expectations for Federal Reserve policy and shape market sentiment through their potential impact on interest rates and Treasury yields.
Meanwhile, Monday marked four years since the beginning of the S&P 500's current bull market, which followed the index's closing low of 3,577.03 in October 2022. Since that point, the benchmark has more than doubled, highlighting the strength of the broader market rally.
