US stocks were modestly higher on Monday as investors navigated a mix of political uncertainty, a packed earnings calendar and anticipation ahead of the Federal Reserve’s first policy decision of the year.
The S&P 500 edged up 0.2%, while the Dow Jones Industrial Average gained 170 points, or 0.4%.
The Nasdaq Composite hovered around the flatline, reflecting a cautious tone in growth-oriented stocks ahead of key catalysts later in the week.
Among individual movers, shares of Meta Platforms and Apple rose more than 1%, while Amazon also traded slightly higher.
Investors appeared selective, positioning ahead of quarterly results from some of the largest technology companies in the index.
Political risk back in focus
Beyond earnings and monetary policy, traders were closely monitoring developments in Washington.
Growing outrage over federal immigration agents fatally shooting a US citizen in Minnesota for the second time this month has raised concerns about a potential government shutdown.
Several Democratic senators said they would not support a $1.2 trillion federal funding package if it includes allocations for the Department of Homeland Security.
The comments added to the political uncertainty already weighing on markets.
The political backdrop pushed some investors toward safe-haven assets.
Gold prices rallied sharply on Monday, climbing to a new all-time high and surpassing $5,100 per ounce as demand rose amid heightened fiscal and political risks in the United States.
Earnings season ramps up
Wall Street’s attention is increasingly shifting to corporate earnings, with more than 90 companies in the S&P 500 scheduled to report quarterly results this week.
That list includes heavyweight names such as Apple, Tesla, Meta Platforms and Microsoft, whose results are expected to play an outsized role in shaping broader market sentiment.
So far, the earnings season has been solid. About 76% of companies that have reported have beaten analysts’ expectations, according to FactSet.
Despite the strong aggregate results, investors have not rewarded all positive surprises.
Shares of Intel and Netflix both declined recently, even after topping estimates, underscoring how guidance and broader concerns can outweigh performance.
Markets recover after weak week
Monday’s modest gains followed a difficult stretch for US equities.
The S&P 500 is coming off a losing week, its second consecutive weekly decline, after escalating geopolitical tensions rattled investors earlier in the period.
Concerns eased toward the end of last week after President Donald Trump said that a “framework” for a deal regarding Greenland had been reached, helping markets stabilise.
Even so, the S&P 500 finished the week down about 0.4%, reflecting lingering caution.
The recent volatility has left investors sensitive to headlines, particularly those tied to geopolitics, trade and fiscal policy, which have repeatedly driven sharp moves across equities, bonds and commodities.
All eyes on the Federal Reserve
The Federal Reserve’s policy meeting later this week is another major focal point.
The central bank is scheduled to announce its decision on Wednesday, marking its first meeting of the year.
While the Fed is widely expected to leave its benchmark overnight interest rate unchanged, investors will be scrutinising the statement and any accompanying commentary for clues on the timing and pace of future rate cuts.
Markets remain divided over when easing might begin, making the Fed’s tone especially important.
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