Stocks fell on Monday as markets brace for the start of earnings season–with several major companies reporting quarterly results this week, as investors also remain nervous about the upcoming June inflation report and what it could mean for the economy.
Markets opened lower: The Dow Jones Industrial Average fell 0.6%, around 200 points, while the S&P 500 lost 0.7% and the tech-heavy Nasdaq Composite 0.8%.
Stocks are coming off of a rare winning week after a better-than-expected jobs report on Friday, though some experts believe the strong labor market will embolden the Federal Reserve to continue hiking rates aggressively as it looks to bring down inflation.
Recession fears continued to weigh on stocks, especially as the yield curve remains inverted: The 2-year Treasury yield traded at roughly 3.08% on Monday, staying slightly higher than the 10-year rate.
Markets also took a hit from negative Covid headlines out of China: Case numbers are rising—with Shanghai reporting its first case of the BA.5 subvariant, while Macau closed its casinos for the week.
Oil prices fell roughly 2% amid the renewed Covid fears in China, with US benchmark trading at $103 per barrel, while international benchmark Brent crude is up to more than $105 per barrel.
Shares of Twitter, meanwhile, fell roughly 5% after Tesla billionaire Elon Musk said he is “terminating” his $44 billion deal to buy the social media company, even as the platform prepares to take legal action to enforce the merger agreement.