The S&P 500 finished little changed on Monday as Wall Street awaited a key debt ceiling meeting.
The benchmark index rose 0.02% to end at 4,192.63, while the Dow Jones industrial average lost 140.05 points, or 0.42%, to end at 33,286.58. The Nasdaq Composite rose 0.5% to 12,720.78.
Monday’s moves brought the tech-heavy index to its highest close and highest intraday level since August.
President Joe Biden and House Speaker Kevin McCarthy are set to meet Monday at 5:30 p.m. to resume debt ceiling talks, just 10 days before the earliest date Treasury Secretary Janet Yellen has said could realistically return to default.
Senior negotiators from both sides resumed talks in the Capitol on Monday morning, but mandatory government spending cuts remain a major obstacle. Republicans are pushing to reduce spending to baseline 2022 levels, but Biden said no across-the-board cuts are out of the question without additional tax hikes.
“Investors are starting to worry about what’s going on with the debt ceiling negotiations, but on the other hand, the economy is still strong, the job market is very strong,” said Chris Zaccarelli, chief investment officer at the Independent Advisor Alliance.
Major averages come in for a successful week. Led by technology stocks, stocks continued to rise despite uncertainty in Washington and sticky inflation, with the S&P 500 below the 4,200 level.
While tech trades should run further, some on Wall Street say a rally in the long run requires strong market breadth.
“If the rest of the market doesn’t participate, there’s an end to this,” said Sylvia Jablonski, CEO of Defiance ETFs, adding that stronger market breadth could come after the Federal Reserve’s June meeting.
Monday ushered in a relatively subdued week for economic data, with Thursday’s second reading of first-quarter gross domestic product and the Federal Reserve’s preferred measure of inflation.
Wednesday’s release of Fed minutes from the May meeting could shed light on how central bankers are thinking about the possibility of more rate hikes.
First-quarter earnings season is winding down, but there are notable reports from Zoom Video, Lowe’s and Dick’s Sporting Goods.
— CNBC’s Christina Wilkie contributed reporting
