By Yasin Ebrahim
Investing.com – The S&P 500 give up gains to close lower Monday, led by selloff in tech as investors maintained bets on earlier rate hikes following news that Federal Reserve Chairman Jerome Powell would be nominated for another term.
The S&P 500 fell 0.32%, and had earlier hit an intraday record of 4,743.74, the Dow Jones Industrial Average was up 0.1%, or 17 points, the Nasdaq fell 1.26%.
President Joe Biden nominated Jerome Powell for a second four-year term as U.S. Federal Reserve Chair and nominated Governor Lael Brainard to vice chair.
Treasury yields jumped on the news, suggesting that some had been betting on Brainard, who leans more dovish, which would likely have led to a lower for longer approach on monetary policy.
The United States 10-Year surged above 1.6%, helping to stoke a bid on banking stocks.
Energy stocks, meanwhile, followed oil prices higher after OPEC+ warned it would reconsider plans at its meeting next week to increase production cuts should countries tap their strategic energy reserves.
The threat from OPEC comes just as reports suggested the U.S. is considering the release of oil from the Strategic Petroleum Reserve in tandem with other countries including Japan.
Tech, which was the standout performer last week, underperformed as the rising yields soured sentiment on the sector.
Excluding Apple (NASDAQ:AAPL) big tech including Meta, formerly Facebook (NASDAQ:FB), Google-parent Alphabet (NASDAQ:GOOGL), Amazon (NASDAQ:AMZN), and Microsoft (NASDAQ:MSFT) ended in the red.
On the economic front, housing activity remained buoyant as existing home sales in October rose by more than 0.8%. This "doesn't seem like a big increase, but it comes on the back of a 7% monthly gain in September and most forecasters were looking for some payback," Jefferies said.
The late selloff on Wall Street comes as some forecast headwinds in the coming weeks for stocks, which have advanced into overbought territory, though that is unlikely to hamper a seasonal rally into year end.
“Year-end seasonality typically favors stocks into Dec. 31, although we could experience some choppiness along the way due to overbought conditions,” Janney Montgomery Scott said in a note.
In other automotive news, Tesla (NASDAQ:TSLA) increased 1% after CEO Elon Musk said in tweet that the company would "probably" launch its Model S Plaid electric sedan in China early next spring.
In health care, meanwhile, vaccine makers BioNTech SE (NASDAQ:BNTX), and Moderna Inc (NASDAQ:MRNA) were in the ascendency with latter up more than 7% after receiving final clearance for their booster shots from the Food and Drug Administration on Friday.
General Motors (NYSE:GM), meanwhile, was up more than 2% after CNBC reported the automaker acquired a 25% stake in the Seattle-based boating start-up Pure Watercraft.