A choppy day of trading on Wall Street ended with stocks mostly lower Monday, as a late-afternoon burst of selling derailed the market from another all-time high.
The S&P 500 fell 0.3% after having been up as much as 1% earlier in the day and on pace to eclipse the record high it set last Thursday. The Dow Jones Industrial Average eked out a 0.1% gain, while the Nasdaq shed an early gain and slid 1.3% below the all-time high it set on Friday.
Bond yields moved solidly higher. Gold prices fell and energy futures mostly rose.
The market was higher for much of the day as traders were relieved to learn that President Joe Biden would nominate Jerome Powell for a second four-year term at the helm of the Federal Reserve, a vote of confidence in Powell’s handling of central bank policies during the brutal disruptions caused by the coronavirus pandemic.
While stocks initially rallied on the news, bonds sold off, pushing yields broadly higher. The yield on the 10-year Treasury rose to 1.63% from 1.54% late Friday.
Higher Treasury yields make the more expensive areas of the market, like technology stocks, less attractive, which may explain why there was more selling in stocks toward the end of the day as the bond market shifted.
“Growth areas of (the stock) market do not like higher bond yields,” said Willie Delwiche, investment strategist at All Star Charts. “Energy and financials, however, loved them.”
The S&P 500 fell 15.02 points to 4,682.94. The Dow gained 17.27 points to 35,619.25. The tech-heavy Nasdaq gave up 202.68 points to 15,854.76.