US stock market today: Wall Street subdued ahead of key earnings; bond market in focus

Technology stocks led the losses after experiencing sharp swings over the summer.

US stock market today: Wall Street indices were subdued on Monday as investors looked ahead to a week filled with events that could have a significant impact on markets. Meanwhile, the parts of the bond market that the US Treasury Department is seeking to steady showed some signs of easing.The S&P 500 fell 0.3%, moving further away from the record high it reached earlier this month. The Dow Jones Industrial Average gained 49 points, or 0.1%, as of 9:35 a.m. Eastern time, while the Nasdaq composite declined 0.6%.Technology stocks led the losses after experiencing sharp swings over the summer. Investors have been concerned that enthusiasm surrounding artificial intelligence has pushed valuations too high and that the strong demand for AI chips may not last if companies fail to generate enough profits.Nvidia, which has emerged as one of the biggest beneficiaries of the AI boom, has also become Wall Street’s largest and most influential stock. The chipmaker is scheduled to report its latest quarterly earnings on Wednesday, with the results potentially setting the direction for the next major move in AI-related shares.Nvidia was down 0.7% and ranked among the biggest drags on the S&P 500, even as most stocks in the index were trading higher. Micron Technology fell 5.5%, while Broadcom dropped 1.5%, adding to the pressure on the index.The bond market has been another major influence on stocks in recent weeks. Longer-term Treasury yields rose through the summer as investors worried about elevated inflation, the government’s heavy debt burden and other factors. Higher yields increase borrowing costs across the economy, not only for the government, and have already contributed to higher mortgage rates and weakness in the housing industry.The US Treasury Department made a surprise announcement last week that it would increase the size of planned Treasury buybacks, a move that could help limit the rise in yields on 10-year and 30-year Treasurys. Analysts, however, cautioned that the impact could be modest because the buybacks are relatively small and do not address the underlying issues of high US government debt and costly oil resulting from the war with Iran.On Monday, the yield on the 10-year Treasury fell to 4.70%, from 4.74% late Friday. It was also back below its level from late Tuesday, before the US Treasury Department unveiled its unexpected buyback announcement.Analysts caution that efforts by the US government to bring down longer-term yields could eventually add to inflationary pressure. Inflation is already running above levels that most people would consider comfortable and has remained elevated for years.This could put additional pressure on the Federal Reserve to increase the federal funds rate, the short-term overnight rate under its control. Higher rates can help contain inflation by slowing economic activity and reducing the appeal of stocks and other investments, thereby putting downward pressure on prices.The Fed’s new chairman, Kevin Warsh, is scheduled to speak on Friday at an economic symposium in Jackson Hole, Wyoming. The mountain location has previously been the setting for important announcements on Fed policy, but investors remain uncertain about what Warsh will say this time.Warsh has repeatedly said he intends to provide financial markets with fewer signals about the Fed’s future interest-rate decisions. His preference is for markets to respond more closely to incoming economic and inflation data rather than to guidance from the central bank.A decline in oil prices provided some relief on the inflation front on Monday. Brent crude fell 1.3% to $91.51 a barrel.Last month, Brent prices moved sharply between $72 and $102 as expectations fluctuated over whether the US and Iran could reach an agreement that would allow oil tankers to resume unrestricted passage out of the Persian Gulf.Stock markets around the world also moved lower. South Korea’s Kospi fell 3.1%, while Hong Kong’s Hang Seng declined 1.9%, among the largest losses across global markets.Seoul has seen some of the world’s most pronounced market swings this summer because two major technology companies, Samsung Electronics and SK Hynix, which have benefited from the AI boom, account for a large share of its market.