US stocks opened little changed on Monday as technology shares eased from recent highs, while investors monitored elevated Treasury yields and oil prices for clues about the Federal Reserve’s interest rate outlook.
The Dow Jones Industrial Average was down 98 points while the S&P 500 was up 0.2% and the Nasdaq Composite gained more than 0.43%.
The subdued start followed a strong session for technology stocks on Friday, when the Nasdaq Composite reached a record high after weaker-than-expected US jobs data reduced expectations for an October rate hike.
Tech stocks ease from highs
Chip stocks were among the main drags in trading. Intel shares fell 2.4%, while Micron Technology declined 0.83%. Nvidia edged 1.28% higher after reaching a record high on Friday.
Investors were also looking ahead to the upcoming earnings season. Around 70% of the S&P 500’s market capitalisation is expected to report results by the end of October.
Recent corporate optimism has helped US stocks outperform global markets over the past six months despite geopolitical risks and inflation concerns.
Goldman Sachs analysts expect median S&P 500 earnings to grow 9% year over year this quarter.
Individual stocks saw significant moves. PTC jumped 35.7% after Schneider Electric agreed to acquire the software company in an all-cash transaction valuing its equity at about $22.6 billion.
RXO rose 23% after C.H. Robinson Worldwide agreed to acquire the transportation broker in a $5.8 billion stock-and-cash deal.
Cerebras Systems gained 4.4% after OpenAI CEO Sam Altman described the chip designer as a close partner.
Treasury yields remain elevated
The benchmark 10-year Treasury yield was around 5.30% on Monday, while the 30-year yield stood near 5.66%.
Both yields have reached multi-year highs in recent weeks as investors assess inflation risks, government finances and heavy debt issuance.
The Federal Reserve raised its overnight interest rate by 25 basis points last month.
Investors will receive further details on the decision when the central bank releases minutes from its September meeting on Wednesday.
Markets currently see an 80% probability that the Fed will leave rates unchanged at its October meeting, according to CME FedWatch data.
However, expectations for a December rate hike remain elevated.
Investors will also monitor September services-sector activity data due later on Monday, including the Institute for Supply Management’s services report.
Oil prices stay near $100
Oil prices remained another key focus for investors as concerns over disruptions to Gulf oil infrastructure supported crude prices.
Brent crude futures fell 0.3% to $101.88 a barrel, while West Texas Intermediate traded around $89.32, down about 1.93%.
The recent rise in oil prices has added to concerns that elevated energy costs could keep inflation pressures high and complicate the Federal Reserve’s policy outlook.
US stocks entered October after a volatile week marked by a sharp rise in Treasury yields and a weaker-than-expected September jobs report.
The labour-market data reduced expectations for an October rate increase and provided some relief to equities, although investors remain focused on the broader risks from higher yields, oil prices and geopolitical uncertainty.
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