Healthcare and utilities stocks showed positive gains on Monday, offsetting declines in commodity and retail stocks. This allowed the S&P 500 to close 0.01% higher.
But initially, stocks fell amid softer economic data and concerns that global economic recovery is slowing because of growing COVID-19 cases due to the highly-infectious Delta variant.
Investors are obviously waiting for hints from the Federal Reserve regarding potential cuts on bond purchases and early tapering.
Fiona Cincotta, senior analyst at City Index, said the decision will most likely shake recovery, making it more "bumpy"instead of smooth.
Tobias Levkovich from Citigroup also warned that investors should prepare for greater volatility due to Fed spending cuts, the possibility of higher taxes, pressure on margins and sustained inflation.
"These four potential issues could cascade into each other around September," Levkovich said.
Other important events for this week are:
- speech of Fed Chairman Jerome Powell (Tuesday);
- four-day meeting of the Standing Committee of the National People's Congress (Tuesday);
- data on US retail sales (Tuesday);
- minutes of the meeting from the Reserve Bank of Australia (Tuesday);
- policy decision of the Reserve Bank of New Zealand and briefing by Governor Adrian Orr (Wednesday);
- minutes of the meeting from FOMC (Wednesday);
- policy decision of the Bank of Indonesia and briefing by Governor Perry Warjiyo (Thursday).
