U.S. market indexes continued to gain in early market trading on Monday however stocks ended the day with losses.
For the day the Dow Jones Industrial Average closed at 18,529.29 for a loss of 14.24 points or 0.08%. The Standard & Poor's 500 was also down, closing at 2,180.89 for a loss of 1.98 points or 0.09%. The Nasdaq Composite closed lower at 5,213.14 for a loss of 7.98 points or 0.15%. The VIX Volatility Index was higher for the day at 11.52 for a gain of 0.13 points or 1.14%.
In the Dow Jones Industrial Average, the following stocks led losses for the day:
- Merck (MRK, Financial) -1.57%.
- Pfizer (PFE, Financial) -1.44%.
- International Business Machines Corp. (IBM, Financial) -0.89%.
- McDonald's (MCD, Financial) -0.77%.
- UnitedHealth (UNH, Financial) -0.60%.
Market trading opened on Monday with continued momentum from Friday’s strong jobs report. On the economic calendar Monday, the Labor Market Conditions Index increased to 1.0. The TD Ameritrade Index, however, was down slightly as investors’ trading momentum has slowed. The TD Ameritrade Index was at 4.69 for July.
A selloff occurred in the market on Monday afternoon despite good news on the economy. With Friday’s positive jobs report, the market is beginning to factor in a federal funds rate increase later in the year. Most economists and traders are now anticipating a rate increase from the Federal Reserve in December. A rate increase shows confidence from the Federal Reserve that the economy is improving. In the current rate environment, it should also help yields.
In a CNBC report on Monday, economist, Anthony Chan, discussed his thoughts on the Federal Reserve’s next rate increase.
Disclosure: I do not directly own any stocks included in this article.
Start a free seven-day trial of Premium Membership to GuruFocus.
