Oil prices reversed course from a week ago when a sharp escalation in fighting between the U.S. and Iran worsened worries about global oil supplies. The price of Brent crude dropped 6.3% to settle at $85.87 a barrel for October delivery. Prices surged to over $100 a barrel last week before easing. The war between the U.S. and Iran has sharply curtailed, and at a times halted, traffic through the vital Strait of Hormuz. That has had a ripple effect throughout the world's economy. Gasoline prices have surged and shipping costs for most goods are rising, with businesses typically passing those costs along to households.

The Federal Reserve meets this Wednesday amid rising inflation driven by U.S. war with Iran and new global tariffs, with Wall Street pricing in a nearly 36% chance of a rate hike. Stubbornly high inflation and surging fuel costs are squeezing household budgets, forcing tighter spending on discretionary items like travel and clothing.

Investors are also closely monitoring heavy corporate earnings this week for signs of consumer stress and to see if soaring stock values are justified by profits. Key reports include Sherwin-Williams, Boeing and Visa, alongside tech giants Microsoft, Amazon, and Apple, whose gains have fuelled Wall Street's record run.

Technology companies were behind much of the shifts in the market, with gains and declines for a mix of big companies resulting in uncertain trading. Nvidia fell 5% and Micron Technology slumped 2.3%. At the same time, Microsoft rose 1.9% and Apple rose 1.2%. They are all among the most valuable companies in the world and those huge valuations give them more influence over the direction of the broader market.

Communications company stocks were among the gainers Monday. Google parent Alphabet rose 2.1% while Charter Communications jumped 6.7% and Comcast rose 2.3%.Credit card issuers and payment processors also gained. American Express climbed 2.8%, Capital One Financial added 2.1%, Visa rose 1.9% and rival Mastercard gained 2.2%. Chinese memory chipmaker CXMT soared in its debut in Shanghai. The company jumped to become China's most valuable listed company with an estimated market capitalization of 3.3 trillion yuan (nearly $490 billion).

In Asia, South Korea's Kospi dropped 10%, dragged by declines in index heavyweights Samsung and SK Hynix. Japan's Nikkei 225 fell 4% and the Topix declined 2.42%. Australia's benchmark S&P/ASX 200 was 0.43% higher.

Bond yields fell. The yield on the 10-year Treasury fell to 4.65% from 4.69% late Friday.

Powered by Capital Market - Live News