The stock market demonstrated inconsistency throughout the trading session, with the key averages fluctuating around neutral before closing with minimal changes. The Nasdaq and the S&P 500 were on track to establish new record closing highs, but dipped into the negative in afternoon trading.
The Nasdaq dropped 48.12 points or 0.3 percent to 15,942.55 and the S&P 500 declined slightly by 4.77 points or 0.1 percent to 5,021.84, while the Dow increased 125.69 points or 0.3 percent to a historic closing peak of 38,797.38.
The unpredictable trading on Wall Street signified a pause for traders following recent market resilience which propelled the S&P 500 beyond 5,000 for the first time. The tech-centric Nasdaq also made significant strides in recent sessions, nearing the record highs achieved in November 2021.
The absence of major U.S. economic data resulted in some traders withholding action in anticipation of several important reports scheduled for release in the near future.
Tuesday will see the Labor Department's release of its report on consumer price inflation for January, which could potentially have a substantial effect on interest rate forecasts. Reports on retail sales, industrial production, producer price inflation, and consumer sentiment will likely draw attention later in the week as well.
Several individual stocks saw significant movement - shares of Teva Pharmaceutical surged by 7.5 percent following Piper Sandler's upgrade of its rating from Neutral to Overweight, while Rocket Lab spiked by 8.8 percent after Citi reinitiated coverage of its stock with a Buy rating. In contrast, shares of Big Lot fell by 28.0 percent as a result of Loop Capital's rating downgrade from Hold to Sell.
Despite the broader market's lackluster performance, tobacco stocks saw substantial gains, propelling the NYSE Arca Tobacco Index up by 3.5 percent. Networking stocks also performed well, as showcased by the 2.5 percent increase in the NYSE Arca Networking Index. The NYSE Arca North American Telecom Index also enjoyed considerable growth, climbing by 1.8 percent. Housing, natural gas, and banking stocks also registered notable strength, while software stocks struggled throughout the session.
In international trading, most Asia-Pacific region stock markets trended downwards on Monday, with some key markets closed for holidays. Australia's S&P/ASX 200 Index dropped by 0.4 percent, and India's Sensex fell by 0.7 percent. In contrast, European markets climbed upwards, with both Germany's DAX Index and France's CAC 40 Index increasing by 0.7 percent and 0.6 percent, respectively, while the U.K.'s FTSE 100 Index barely moved.
In the bond market, treasuries experienced fluctuations throughout the session and demonstrated marginal strength. Consequently, the benchmark ten-year note's yield, which is inversely related to its price, declined by 1.9 basis points to 4.168 percent.
The forthcoming trading on Tuesday is anticipated to react to the Labor Department's report on consumer price inflation for January.