S&P500 falls lower: Chevron acquires Hess Corporation

The Nasdaq Composite ticked higher on Monday as Treasury yields retreated from their highs and traders looked ahead to the release of corporate earnings from tech industry giants.

The benchmark 10-year Treasury note yield briefly climbed back above the key 5 per cent level before ticking down. It was last trading at about 4.85 per cent.

Interest rates have soared in recent weeks, with the 10-year Treasury yield’s break above 5 per cent on Thursday marking the first such occurrence for the benchmark since July 2007.

Comments from Federal Reserve Chair Jerome Powell on Thursday suggested that monetary policy could tighten further. This seemingly stoked investor concern and underpinned the rise in Treasury yields. Some analysts think the benchmark yield could still have further room to run.

The Dow Jones Industrial Average slipped 190.87 points, or 0.58 per cent, to close at 32,936.41, while the S&P 500 fell 0.17 per cent to 4,217.04. The tech-heavy Nasdaq Composite added 0.27 per cent to finish the session at 13,018.33.

Shares of oil major Chevron slipped 3.7 per cent following news that the company would purchase peer Hess in a $53 billion all-stock deal, or $171 per share. The acquisition allows Chevron to develop drilling in Guyana, and it comes approximately two weeks after Exxon Mobil acquired Pioneer Natural Resources in a $59.5 billion all-stock deal.

Such major acquisitions have raised expectations of further consolidation across the industry.

Pharmacy giant Walgreens ticked up 3 per cent following an upgrade from JPMorgan. Online security stock Okta slid for a second day, following a data breach; shares shed 8 per cent

Earnings season ramps up this week, with a slew of big tech titans set to report. Investors anticipate results from Alphabet, Amazon, Meta and Microsoft will provide key information for the stock market.

Turning to US sectors, all closed lower except for Communication Services, Technology and Consumer Discretionary. Energy was the worst performer.

Futures

The SPI futures are pointing to a 0.2 per cent fall.

Currency

One Australian dollar at 7:35 AM was buying 63.34 US cents.

Commodities

Gold lost 0.51 per cent. Silver dropped 1.57 per cent. Copper added 0.52 per cent. Oil fell 2.27 per cent.

Figures around the globe

European markets closed mixed. London’s FTSE fell 0.37 per cent, Frankfurt added 0.02 per cent, and Paris closed 0.50 per cent higher.

Turning to Asian markets, Tokyo’s Nikkei lost 0.83 per cent, Hong Kong’s Hang Seng was closed while China’s Shanghai Composite closed 1.47 per cent lower.

The Australian share market closed 0.82 per cent lower at 6,844.

Sources: Bloomberg, FactSet, IRESS, TradingView, UBS, Bourse Data, Trading Economics, CoinMarketCap.
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