The S&P 500 stayed close to flat Monday, a day after its latest record close, as energy stocks jumped on a stalled reopening of the Strait of Hormuz and traders awaited a week of inflation data. J.P. Morgan raised its year-end target for the index to 8,000 from 7,800.
The Dow Jones Industrial Average gave up more than 100 points, or 0.2%, Monday. The Nasdaq composite slipped 0.1%, while the S&P 500 stayed close to flat. Energy and healthcare led the index's sectors, while utilities and real estate lagged the most.
Energy jumps as Hormuz standoff drags on
Energy stocks rallied as West Texas Intermediate crude jumped more than 3% to around $80.70 a barrel. President Trump told Axios the U.S. was "only semi-negotiating" with Iran and wanted Tehran to feel economic pressure. Iran's foreign ministry spokesman Esmail Baghaei reportedly said Monday that talks with Oman about reopening the Strait of Hormuz were ongoing, though the waterway won't fully reopen until the U.S. lifts its naval blockade and compensates Tehran, he said. Separately, Reuters reported Iran was close to a final agreement with Oman on new shipping lanes between the two countries.
Rate-hike bets ease as CPI looms
Rate-hike bets were tempered Friday after data showed the U.S. economy unexpectedly shed jobs in July. Traders now price in a 44% chance of a rate hike in September, according to the CME FedWatch tool. Wednesday's consumer price index report is expected to show the 12-month inflation rate easing to 3.4% from 3.5%, according to FactSet.
Wall Street holds near record levels
Monday's session follows a stretch of strength for the index: the S&P 500 posted a record close last Friday. The Dow also touched all-time highs last week. J.P. Morgan raised its year-end target for the S&P 500 to 8,000 from 7,800. So far, 85.1% of the 436 S&P 500 companies that have reported June-quarter earnings have beaten estimates, above the 67% typical since 1994, according to LSEG data.
Among individual stocks, Apple fell 2.4% after a downgrade from Jefferies. Intel, meanwhile, dropped 4.8% after launching a $15 billion stock offering. The SPDR S&P Homebuilders ETF still fell more than 2% Monday even though it's up more than 5% year to date, lagging the S&P 500's gain so far this year.
Sources: Investor's Business Daily, Economy News
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