The S&P 500 edged up by 0.34, or less than 0.1%, to 4,288.39, coming off its worst month of the year. The Dow Jones Industrial Average was down 74.15 points, or 0.2%, at 33,433.35, and the Nasdaq Composite rose 88.45, or 0.7%, to 13.307.77.
Slumps for oil-and-gas stocks weighed on the market as crude prices gave back some of the sharp gains made since the summer. The majority of stocks fell beside them, with more than three quarters of those within the S&P 500 falling, but gains for Apple and other influential Big Tech stocks helped boost indexes.
Stocks have given back 40 of their strong gains for the year since the end of July. The main reason behind Wall Street's growing acceptance that high interest rates are here to stay a while as the Federal Reserve seeks to lower high inflation. In turn, this has driven up the yields of the NYSE to their highest levels in more than a decade.
The yield on the 10-year note climbed again Monday, to 4.67% from 4.98% late Friday, and is nearing its highest level since 2007.
Borrowing becomes more expensive for all kinds of businesses, which can affect their profits. Since the Federal Reserve announced last month that it expected to not cut interest rates as much in 2024 as previously expected, the value of the U.S. dollar has also risen compared to other currencies. S&P 500 companies face a painful loss from abroad, where they generate a significant portion of their revenue.
The overall U.S. economy is so far resisting predictions that it would have fallen into recession by now.
Manufacturing has been a area that's been stinging of higher rates, and reports Monday suggest it's still contracting, though perhaps not by as much as expected. A report from the Institute for Supply Management said U.S. manufacturing shrank in September for an 11th consecutive month.
The report also indicated prices were easing in September, which was encouraging for Wall Street. The move could mean less pressure on inflation, which has been feeling heat lately due to rising oil prices.
Congress over the weekend avoids a shutout of the federal government, which threatens to hurt the economy and disrupt the publishing of economic data Wall Street finds crucial. But Capitol Hill only temporarily delayed the threat, promising another showdown. Plus, traders are well aware that the stock market has held up rather well through previous shutdowns.