The three major U.S. stock averages gained about 0.2% on Monday, attempting to recover from last week's steep losses, which saw the Dow suffer its sharpest one-week decline since 2023.
US stocks edge up on Monday
Investors weighed a mixed retail sales report, which showed that overall retail sales increased by just 0.2%, falling short of expectations. However, the control group, which factors into GDP calculations, surged by 1%, significantly exceeding the forecasted 0.2%.
Despite the modest rebound, investor sentiment remained cautious following comments from Treasury Secretary Scott Bessent, who downplayed the recent stock market pullback, stating that "corrections are healthy." While his remarks aimed to reassure, they also sparked concerns about the potential economic impact of current policies under the Trump administration.
Focus on Fed meeting
Additionally, markets remained focused on the Federal Reserve's upcoming policy decision, with the central bank widely expected to maintain the fed funds rate at its current level while releasing updated economic projections. Investors are looking for any signals regarding the Fed’s outlook on inflation and potential rate cuts later in the year.
Sector-wise, energy and real estate led gains, benefiting from higher commodity prices and improving housing market sentiment. In contrast, utilities underperformed, weighed down by concerns over interest rate policy and sector rotation.
