WASHINGTON (dpa-AFX) - Stocks saw considerable volatility over the course of the trading session on Monday before eventually ending the day mostly lower. The major averages recovered from an early slump but once again came under pressure in the latter part of the session.
The major averages ended the day off their early lows but still in negative territory. The Nasdaq slid 133.49 points or 0.7 percent to 17,844.24, the S&P 500 fell 36.29 points or 0.6 percent at 5,650.38 and the Dow dipped 98.60 points or 0.2 percent to 41,218.83.
The early pullback on Wall Street came as some traders looked to cash in on the recent strength in the markets, which lifted the major averages to their best levels in a month.
The S&P 500 closed higher for the ninth consecutive session last Friday, marking its longest winning streak in over twenty years.
Renewed trade concerns also weighed on stocks after President Donald Trump announced plans to impose a 100 percent tariff on movies produced in foreign countries.
'The Movie Industry in America is DYING a very fast death,' Trump said in a post on Truth Social. 'Other Countries are offering all sorts of incentives to draw our filmmakers and studios away from the United States. Hollywood, and many other areas within the U.S.A., are being devastated.'
'This is a concerted effort by other Nations and, therefore, a National Security threat. It is, in addition to everything else, messaging and propaganda!' he added. 'WE WANT MOVIES MADE IN AMERICA, AGAIN!'
Trump also told reporters on Sunday that he has no plans to talk to his Chinese counterpart Xi Jinping this week, offsetting recent optimism about a potential U.S.-China trade deal.
However, early selling pressure waned following the release of a report from the Institute for Supply Management showing an unexpected increase by its reading on U.S. service sector activity in the month of April.
The ISM said its services PMI rose to 51.6 in April from 50.8 in March, with a reading above 50 indicating growth. Economists had expected the index to edge down to 50.6.
The subsequent recovery attempt also came after a report from Bloomberg said India has proposed zero tariffs on steel, auto components and pharmaceuticals up to a certain amount in its trade negotiations with the U.S.
Citing people familiar with the matter, Bloomberg said the offer was made by Indian trade officials visiting Washington late last month to expedite negotiations on a bilateral trade deal.
Sector News
Energy stocks turned in some of the market's worst performances on the day amid a steep drop by the price of crude oil, with the Philadelphia Oil Service Index plunging by 2.7 percent and the NYSE Arca Oil Index slumping by 1.7 percent.
The price of crude oil tumbled to its lowest closing level in over four years after members of OPEC+ agreed to increase output by another 411,000 barrels per day in June.
Notable weakness also emerged among steel stocks, as reflected by the 1.1 percent loss posted by the NYSE Arca Steel Index.
On the other hand, gold stocks moved sharply higher along with the price of the precious metal, driving the NYSE Arca Gold Bugs Index up by 3.1 percent.
Airline stocks also turned in a strong performance but closed well off their best levels, with the NYSE Arca Airline Index climbing by 1.2 percent.
Other Markets
In overseas trading, stock markets across the Asia-Pacific region turned in a mixed performance in light trading on Monday, as several major markets were closed for holidays. Australia's S&P/ASX 200 Index slumped by 1.0 percent, while India's Nifty 50 Index climbed by 0.5 percent.
The major European markets also ended the day mixed, with the U.K. market closed for a holiday. While the German DAX Index jumped by 1.1 percent, the French CAC 40 Index fell by 0.6 percent.
In the bond market, treasuries extended the notable downward move seen over the two previous sessions. Subsequently, the yield on the benchmark ten-year note, which moves opposite of its price, rose 2.1 basis points to 4.343 percent.
Looking Ahead
A report on the U.S. trade deficit is likely to attract some attention on Tuesday, although trading activity may be somewhat subdued as the Federal Reserve's two-day monetary policy meeting gets underway.
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