Wall Street's major averages were mixed at Monday's close as the Dow Jones Industrial Average and S&P 500 continued to lose ground on persistent worries of a US/China trade war while the Nasdaq closed slightly higher on gains in Alphabet (GOOG, GOOGL) and Tesla ( TSLA ). Although a rebound in the energy complex lifted the Dow from the session low, the blue chip index closed lower for a fifth straight day, its longest losing streak since April.
Selling erupted overnight as Asian markets reacted to Friday's retaliatory trade sanctions from China against the US, sending European bourses lower with losses amplified by the showdown in Germany between Chancellor Angela Merkel and her coalition partners over Merkel's migration policies.
An incremental move lower followed the June NAHB housing market index as trade restrictions on Canadian lumber weighed on homebuilders' confidence. The index dropped to 68 from 70 in May, missing expectations for an increase to 78.
Oil began its impressive rebound overnight on reports that the Organization of the Petroleum Exporting Countries will endorse a production increase of only a third what was endorsed by Russia and Saudi Arabia. The upswing gained momentum during the North American session, driving Brent crude futures up by more 2% and the energy sector of the S&P more than 1% higher.
Remarks from Atlanta Fed president Raphael Bostic had little impact on Wall Street. Bostic, a voting member this year, said in a speech today that the economy is facing headwinds from fading business optimism and that recent strength in economic growth is likely tied to transitory factors. Accordingly, Bostic is endorsing only three rate hikes in 2018, one less than indicated on the Fed's "dot plot."
For Tuesday, more data on the housing market is scheduled before the open with May housing starts and building permits. Starts are expected to increase by 2.5% while permits are forecasted to decline 0.1%.
Dow Jones Industrial Index was down 103.01 points (-0.41%)
S&P 500 was down 5.79 points (-0.21%)
Nasdaq Composite Index was up 0.65 points (+0.00%)
FTSE 100 was down 0.36%
Nikkei 225 was down 0.75%
Hang Seng Index was closed
Shanghai China Composite Index was closed
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