US stocks managed to eke out gains on Monday as bond yields eased off bigger gains and Wall Street largely shrugged off Moody’s downgrade of the US credit rating. Meanwhile, investors digested developments in President Trump’s tariff salvos.
The Dow Jones Industrial Average (^DJI) edged up 0.3%. The S&P 500 (^GSPC) managed to close above the flatline to extend its 5-day win streak. The tech-heavy Nasdaq Composite (^IXIC) also rose slightly.
DJI – Delayed Quote•USD
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Moody’s cut the US government’s long-term credit rating from AAA to AA1 late Friday, citing escalating deficits and the increasing burden of refinancing US debt amid elevated interest rates. The downgrade brings Moody’s in line with Fitch and S&P, which previously stripped the US of its top-tier rating.
Even as stocks continued their recent bullish run, bumpy progress of the Republican tax-and-spend bill remained in high focus. Longer-dated Treasury yields eased from their session highs. The benchmark 10-year yield (^TNX) had risen to near the key 4.5% level, and the 30-year equivalent (^TYX) broke above 5% — a level not seen since late 2023, before declining.
On the tariffs front, Treasury Secretary Scott Bessent warned countries that their imports will return to facing “Liberation Day” hikes if they don’t negotiate deals “in good faith” during the 90-day pause. He added that the US is focused on striking deals with 18 “important” trading partners, speaking in a Sunday interview with CNN.
Trump himself provided a broadside at US retail giant Walmart (WMT) on social media, urging the company to “eat the tariffs.” It represented the latest pushback from the president against companies showing consumers the cost of his economic moves, after a brief tit-for-tat last month with Amazon (AMZN).
This week’s calendar is light on scheduled economic announcements, and the market is monitoring manufacturing data and initial jobless claims.
On the earnings front, with many of the heavy-hitters already reporting for the quarter, attention will shift to key names in retail. Target (TGT) and Home Depot (HD) are slated to report later in the week.
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Stocks climb, S&P notches sixth straight day of a gains as bond yields ease
Stocks managed to close higher on Monday as longer-dated bond yields eased and investors looked past Moody’s recent downgrade of the US credit rating.
The Dow Jones Industrial Average (^DJI) edged up roughly 0.3%.
The S&P 500 (^GSPC) closed up nearly 0.1% to extend its 5-day win streak. The tech-heavy Nasdaq Composite (^IXIC) rose just above the flatline.
Stocks trimmed losses from earlier in the session after longer-dated Treasury yields pulled back from their session highs: the benchmark 10-year yield (^TNX) had climbed toward the key 4.5% level, while the 30-year yield (^TYX) briefly topped 5% — a milestone not seen since late 2023 — before retreating.
Today at 7:15 PM UTC
JPMorgan’s Dimon sees ‘extraordinary amount of complacency’ as markets recover from tariff shock
Bitcoin (BTC-USD) hovered near its highest level since January, surpassing $105,000 per token on Monday.
The price of cryptocurrency has been buoyed as companies add tokens to their balance sheets and the Trump administration moves to build out a crypto-friendly network.
On Monday, Coinbase (COIN) became the first and only crypto exchange to enter the S&P 500 (^GSPC).
Today at 6:00 PM UTC
Credit downgrades don’t usually have lasting impacts on stocks
As our Chart of the Day from Carson Investment Research’s global macro strategist Sonu Varghese shows, stocks slid in the initial reaction to credit downgrades in 2011 (S&P) and 2023 (Fitch). But the releases didn’t have lasting impacts on the S&P 500’s performance.
“Both S&P and Fitch’s downgrades line up with longer term bull markets for US equities, showing that credit rating agency decisions have not provided any signal about the future direction of stock prices,” DataTrek Research co-founder Nicholas Colas wrote in a note to clients on Monday morning.
Today at 5:50 PM UTC
Nvidia CEO: China chip ban has cost the company $15 billion in sales
Apple, Alibaba decline on report White House concerned about AI deal
Shares of Apple (AAPL) and Alibaba (BABA) were down on Monday following a New York Times report stating that the Trump administration is concerned about a deal between the two companies that would make the Chinese company’s artificial intelligence available on iPhones in China.
The report states White House officials and some members of Congress are concerned the recent agreement, which was confirmed by Alibaba, would help accelerate China’s artificial intelligence capabilities.
On Monday, both Apple and Baba stock dropped roughly 2% amid an overall market retreat.
Today at 1:51 PM UTC
Coinbase stock officially joins S&P 500, cementing milestone for company and crypto industry
Coinbase (COIN) on Monday became the first and only cryptocurrency platform to see its stock join the S&P 500 (^GSPC) index, a milestone that crypto bulls cheered during what became a busy week of developments for the company.
Coinbase stock was down roughly 1% shortly after Monday’s open. Its shares are up more than 25% since news broke a week ago that the crypto exchange provider would be added to the broad benchmark index.
“It’s going to be in everybody’s 401(k),” he added. “Everyone’s going to have crypto exposure, you know, at least indirectly through Coinbase, which is great. And it’s also a symbol that crypto is updating the financial system.”
S&P 500 falls, snaps 5-day win streak as Treasury yields rise
Stocks fell on Monday, with Tech and Consumer Discretionary leading to the downside, while Treasury yields rose in reaction to Moody’s downgrade of the US credit rating. Investors also digested tariff comments from Treasury Secretary Scott Bessent that signaled the trade war isn’t over.
Late on Friday, Moody’s cut the US government’s long-term credit rating from Aaa to Aa1. Investors may also be reacting to Treasury Secretary Scott Bessent’s remarks over the weekend, in which he said countries would see a return to April 2 “reciprocal” tariff levels if they don’t negotiate in good faith.
Treasury yields rose as bond prices fell. The benchmark 10-year yield (^TNX) rose to around 4.55%, and the 30-year equivalent (^TYX) broke above 5% — its highest level since late 2023.
Palantir shares slid 4% an hour before the opening bell. In recent weeks, some analysts have noted concerns about the AI software play’s lofty valuation. Last week, Palantir hit another record high.
Novavax (NVAX) stock shot up more than 16% premarket on Monday after the company finally received FDA approval for its COVID-19 vaccine, though only under some conditions.
The US Food and Drug Administration approved Nuvaxovid for use in older adults and people over 12 years with health conditions that put them at risk from COVID. The vaccine was previously approved for emergency use only.
Novavax’s vaccine approval had been called into question after the FDA delayed its approval decision and Health and Human Services Secretary Robert F. Kennedy Jr. expressed skepticism over its efficacy.
‘Sell America’ is back as Moody’s pushes 30-year yield to 5%
The yield on 30-year Treasurys rose to the key 5% level early on Monday after Moody’s became the last of the major ratings agencies to downgrade US credit.
The move stoked concerns around the growing $36 trillion US deficit, seen by some as a looming debt time-bomb.
Nvidia stock falls after chipmaker debuts products at Taiwan expo
Wall Street is digesting a stream of announcements from Nvidia CEO Jensen Huang in Taiwan, ranging from development of human-shaped robots to tech that lets customers build custom AI servers.
Shares in the AI chipmaker dropped around 3% in the wake of the news from the Computex Taipei tech expo in Taiwan on Monday.
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At close: 4:00:00 PM EDT
Yahoo Finance’s Daniel Howley reports on the product debuts:
Morgan Stanley says buy any dip in US stocks after Moody’s cut
Bloomberg reports:
Investors should buy any dips in US stocks fueled by Friday’s credit rating cut, as the trade truce with China has reduced the odds of a recession, according to Morgan Stanley’s Michael Wilson.
The strategist sees a greater chance of a pullback in equities after the downgrade by Moody’s Ratings pushed 10-year bond yields (^TNX) above the key 4.5% level. However, “we would be buyers of such a dip,” Wilson wrote in a note.
S&P 500 futures (ES=F) slid 1.2% on Monday following the debt downgrade, which Moody’s said was in response to a ballooning budget deficit that showed little sign of narrowing. The move has reignited worries about whether US assets are still popular at a time of lingering global trade uncertainty.
