Wall Street delivered a mixed performance on Monday, with the Dow Jones Industrial Average eking out a modest gain while the Nasdaq Composite retreated, as a slight pullback in Treasury yields failed to fully soothe investor anxiety following last week's bond-driven sell-off.
As of late morning trading, the Dow had added 0.22% to reach 49,637.04, according to LSEG data. In contrast, the S&P 500 slipped 0.15% to 7,397.32, and the tech-heavy Nasdaq Composite dropped 0.44% to 26,110.02. The readings reflect data delayed by at least 15 minutes.
The bond market remained a central focus. The yield on the benchmark 10-year Treasury note eased to 4.573% after earlier touching 4.631%, a level not seen since February 2025. This key yield influences government borrowing costs and shapes the trajectory of mortgage rates and other consumer loans. Meanwhile, Brent crude oil prices fell nearly 2% on reports that Washington may offer a temporary waiver on Iranian oil sanctions.
"Yields are key to all of this," said Robert Pavlik, senior portfolio manager at Dakota Wealth. Higher yields tend to put pressure on growth stocks, as investors discount the present value of future earnings when bonds offer more attractive payouts.
The artificial-intelligence trade has been a major driver of this year's market gains. Nvidia, a bellwether for the AI sector, is scheduled to report earnings on Wednesday. The stock has climbed 36% from its March low. The Philadelphia SE Semiconductor Index has surged more than 60% year-to-date, fueled by relentless demand for AI chips. A Reuters week-ahead preview highlighted upcoming earnings reports from Walmart, Home Depot, Target, and TJX, which are expected to bring the consumer story back into focus.
Stocks came under pressure on Friday, with the Dow falling 1.07%, the S&P 500 losing 1.24%, and the Nasdaq declining 1.54%, as both crude prices and Treasury yields moved higher. Kenny Polcari, chief market strategist at Slatestone Wealth, commented that the market had "gotten way ahead of itself" after traders rushed into the AI narrative.
In corporate news, Dominion Energy shares rallied after NextEra Energy announced it would acquire the company in an all-stock deal valued at approximately $66.8 billion. NextEra is seeking to capitalize on the growing power demands from data centers. Other utilities have also been active: AES is set to be acquired by a group led by Global Infrastructure Partners and EQT, while Constellation Energy recently announced a deal to acquire Calpine. NextEra CEO John Ketchum stated that the merger should allow the combined company to "buy, build, finance and operate more efficiently." Dominion serves Northern Virginia's "Data Center Alley," one of the world's largest concentrations of data centers.
In the healthcare sector, Regeneron Pharmaceuticals saw its stock decline after an experimental melanoma combination treatment failed to meet its primary endpoint in a late-stage study. The trial measured how long melanoma patients remained without disease progression. BMO Capital Markets analyst Evan Seigerman noted that "back-to-back key pipeline misses" have placed greater scrutiny on Regeneron's outlook over the next 12 to 18 months.
While bond yields eased on Monday, the respite may be short-lived. Reuters' Morning Bid highlighted that the 30-year Treasury yield hit 5.159%, levels not seen since before 2007, with concerns over oil prices, inflation, and government debt shaking the bond market. If yields begin to rise again, richly valued tech stocks could face renewed selling pressure, regardless of how Nvidia's earnings report turns out.
For now, markets are caught between the AI-driven optimism that continues to draw capital into chip stocks, power demand plays, and mega-cap tech names, and the persistent anxiety over rising rates that keeps questioning the value of future profits in a higher-yield environment.
