DJIA: 34,411.69, down 39.54
S&P 500: 4,391.69, down 0.90
Nasdaq: 13,332.36, down 18.72

Stocks dip, Energy, Financials outperform

U.S. stocks finished modestly lower in choppy trading on Monday as investors monitored rising Treasury yields and awaited a busy week of corporate earnings. The S&P 500 ended just below the flat line, while the Nasdaq Composite dipped 0.1% following a downbeat holiday-shortened week during which the benchmarks fell 2.1% and 2.6%, respectively. The Dow lost 39 points on the heels of its third straight weekly drawdown (-0.8%). Trading volume was light, roughly 20% below the 30-day average, with most European markets closed in observance of Easter.

Six of 11 S&P 500 sectors ended in negative territory with the more traditionally defensive Health Care and Consumer Staples losing the most. Financials bucked the downtrend, with Bank of America Corp. up 3.4% as strong trading revenue overshadowed a 13% year-over-year decline in earnings. However, Charles Schwab Corp. weathered its worst session in over two years (-10.5%) as weakness in its trading operations contributed to a disappointing profit tally. In other corporate news, Twitter Inc. gained 6.8% after its board of directors adopted a poison pill to stop Tesla Inc.’s CEO Elon Musk from advancing his stake in the company beyond 15%.

Longer-dated Treasuries extended their rout as market participants braced for a more aggressive path of monetary policy tightening in light of persistent inflation. The yield on the 10-year note rose three basis points (0.03%) to 2.86%, its highest level since December 2018. On the data front, a measure of homebuilder sentiment eased to a seven-month low in April. In commodities, West Texas Intermediate crude climbed 0.8% to $107.84/barrel, while U.S. natural gas prices soared to a 13-year peak.

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