S&P 500 Hugs Flatline While Dow Rallies

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U.S. stocks wobbled Monday as losses across several sectors offset a rally among energy shares.

The S&P 500 fell 0.1% and the Nasdaq Composite declined 0.3%. The Dow Jones Industrial Average bucked the trend, rising 0.5% in afternoon trading.

Stocks’ momentum has taken a hit lately, with both the S&P 500 and Dow logging their steepest one-week declines since June on Friday.

Money managers are hoping markets perk up in the coming days, which will bring about fresh data on inflation, retail sales and consumer confidence. Investors say they are also closely watching a proposed $3.5 trillion spending plan from Washington that could potentially send more funds toward healthcare, education and climate legislation.

“I do believe that the bulls have a little more ammunition than the bears: fiscal support still remains on tap, activity indicators are strong,” said Gregory Perdon, chief investment officer of Arbuthnot Latham. “Risk is still on.”

Energy shares were among the strongest performers in the S&P 500 on Monday, rising alongside the price of oil after the Organization of the Petroleum Exporting Countries said it expected global demand to exceed pre-pandemic levels next year.

Marathon Oil, APA and Occidental Petroleum rose at least 6% apiece. U.S. crude for October delivery gained 73 cents, or 1%, to $70.45 a barrel.

A significant portion of U.S. oil production in the Gulf of Mexico remains offline after Hurricane Ida.

Photo: Christopher Matthews

Meanwhile, shares of Texas-based miner and explorer Uranium Energy jumped 2.3% as individual investors sought out bets that would benefit from a recent rise in uranium prices.

Airbnb slipped 2.9% after Goldman Sachs Group analysts recommended investors sell the stock.

Government bond prices ticked higher Monday, with the yield on the benchmark 10-year U.S. Treasury note edging down to 1.320% from 1.340% on Friday. Yields fall as bond prices rise.

The current level of yields is signaling that bond investors see higher inflation levels as transitory, according to Georgina Taylor, a multiasset fund manager at Invesco. On Tuesday, traders will get a look at the latest readings on consumer prices.

“There is not enough inflationary pressure to really feel a reassessment of nominal growth over the long term,” she said.

Elsewhere, the Stoxx Europe 600 ticked up 0.3%, snapping a four-session streak of losses.

Japan’s Nikkei 225 added 0.2%, while Hong Kong’s Hang Seng Index fell 1.5%.

Write to Anna Hirtenstein at anna.hirtenstein@wsj.com and Michael Wursthorn at michael.wursthorn@wsj.com 

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