The S&P 500 fell 0.7% on Monday, ending its nine-day winning streak due to energy stocks’ weakness and heightened caution ahead of essential trade negotiations and the Federal Reserve meeting. Both the Dow Jones and Nasdaq followed suit, dipping 0.2% and 0.7% respectively.

Energy Sector Declines Weigh on Markets

Major energy companies, including Exxon Mobil and Chevron, faced declines following OPEC+’s announcement to boost oil output starting in June. This decision pressured crude prices, with Brent futures dropping to $60.14.

• Market Reaction: The energy sector suffered some of the steepest declines in the session.
• Production Outlook: OPEC+’s decision highlights fewer restrictions on supply, sparking concerns over price gains in the short term.

Focus on Trade Deals and Economic Stability

Market sentiment turned cautious following former President Trump’s comments about potential trade agreements, suggesting they could be announced this week. Increased tensions between the U.S. and China continue to influence market dynamics.

• Global Trade Stability: Investors are concerned about how trade agreements might influence inflation and growth.
• Risk Sentiment: Any significant developments could boost risk-oriented trades as the Fed’s policy decision approaches.

Individual Stock Highlights

On the downside, Berkshire Hathaway dropped 5% due to a poor quarterly earnings report affected by wildfire insurance losses. Conversely, Skechers surged over 24% after announcing a privatization deal from 3G Capital. Tyson Foods decreased nearly 8% due to disappointing revenue linked to meat inflation affecting consumer demand.

Upcoming trade decisions and the Fed meeting will continue to drive volatility in the market. Traders will likely pivot sectors based on economic signals and earnings results.