Stocks were mixed as investors closely monitored developments in Washington, D.C., as lawmakers rush to try and avert a government shutdown and advance a bevy of new measures.
The S&P 500 fell to give back some gains after the blue-chip index posted a three-day winning streak at the end of last week. The Nasdaq lagged with a drop of 0.5% as Treasury yields climbed. The benchmark 10-year yield extended last week’s gains to the top 1.5%, reaching its highest level since June as optimism over the economic recovery mounted. The Dow added about 0.2%, with energy shares outperforming during the session.
Investors are kicking off trading this week following a volatile streak of trading, with the potential default of key Chinese property developer Evergrande and concerns over monetary and fiscal policy front and center. At its lowest closing level last week, the S&P 500 had pulled back just over 4% from its Sept. 2 record closing high. The index, however, has since recouped most of those gains, and traded about 1.8% below its all-time closing high by the end of the session.
This week, investors will be watching developments on the fiscal front especially closely. Lawmakers are racing to vote in the coming days on legislation to fund the government beyond the end of the fiscal year and prevent a government shutdown. This will come against a backdrop of ongoing debates around a bipartisan $1 trillion infrastructure deal and $3.5 trillion budget reconciliation package.
And elsewhere, Federal Reserve Chair Jerome Powell is set to testify with Treasury Secretary Janet Yellen before the Senate Banking Committee, and the House Financial Services Committee, on the Fed and Treasury’s responses to the coronavirus pandemic.
(Except for the headline, this story has not been edited by The Finance World staff and is published from a syndicated feed.)
