Markets Start the Week Mixed Amid Tech Sector Struggles and Interest Rate Concerns

Stocks remained under pressure on Monday, with the Nasdaq and S&P 500 extending their losses from last Friday’s sell-off, while the Dow Jones Industrial Average showed resilience.

As of late morning trading, the Nasdaq dropped 253.05 points (1.3%) to 18,908.58, and the S&P 500 slid 33.15 points (0.6%) to 5,793.89. Meanwhile, the Dow defied the downtrend, rising 148.14 points (0.4%) to 42,086.59, supported by gains in select healthcare stocks.

Tech Sector Slump Drags Nasdaq Lower

The tech-heavy Nasdaq hit its lowest point in nearly two months, driven by ongoing weakness in technology stocks. Nvidia (NVDA), a prominent player in artificial intelligence and chipmaking, saw its shares tumble 3.2%. Quantum computing stocks also faced pressure following statements from Meta CEO Mark Zuckerberg and Nvidia CEO Jensen Huang, who both suggested that quantum computing may take a decade to become a practical technology.

Concerns over rising interest rates further weighed on investor sentiment. Last week’s stronger-than-expected U.S. jobs report raised fears of prolonged monetary tightening, pushing bond yields higher. The benchmark 10-year Treasury yield climbed to 4.801%, its highest level in over a year.

Upcoming Economic Data and Earnings

Investors are awaiting key economic reports this week, including updates on consumer and producer price inflation, weekly jobless claims, retail sales, and industrial production. These figures are expected to shed light on the Federal Reserve’s next moves regarding interest rates.

Earnings season also kicks into gear, with major financial institutions such as Citigroup, Goldman Sachs, JPMorgan, and Wells Fargo set to release their quarterly results.

Dow Boosted by Healthcare Gains

The Dow’s modest rally was largely attributed to UnitedHealth Group (UNH), which surged after the U.S. government proposed a 4.3% average increase in reimbursement rates for Medicare Advantage plans for 2026.

Sector Highlights

Several sectors exhibited notable trends on Monday:

• Airlines: The NYSE Arca Airline Index dropped 2.9%, retreating from its recent two-month high.
• Computer Hardware: Stocks in this sector fell sharply, with the NYSE Arca Computer Hardware Index down 2.8%.
• Energy: Oil, steel, and natural gas stocks outperformed, providing some strength to an otherwise weak market.
• Defensive Sectors: Gold, utilities, and semiconductor stocks experienced significant declines.

Global Market Overview

Overseas, Asian markets ended mostly lower, with China’s Shanghai Composite Index slipping 0.3% and Hong Kong’s Hang Seng Index falling 1.0%. Japanese markets were closed for a holiday.

In Europe, major indexes also retreated. The U.K.’s FTSE 100 Index was down 0.2%, while France’s CAC 40 Index and Germany’s DAX Index both fell 0.3%.

In the bond market, Treasury yields continued to rise, reflecting concerns about inflation and higher interest rates.

Outlook

As markets navigate a volatile week, attention will remain on inflation data and corporate earnings, which could shape the trajectory of stocks and bonds. With uncertainties surrounding technology, interest rates, and global growth, investors are bracing for further market turbulence.