By Yasin Ebrahim
Investing.com -- The S&P 500 flitted between gains and losses Monday as gains in energy offset a Tesla-led slump in consumer discretionary stocks.
The S&P 500 rose 0.2%, the Dow Jones Industrial Average gained 0.6%, or 184 points, and the Nasdaq fell 0.43%.
Energy jumped more than 3% after oil clawed back earlier losses on fears of a supply shortage as European members appear to be making progress on an agreement to ban Russian oil.
APA (NASDAQ:APA), Marathon Oil (NYSE:MRO), and Occidental Petroleum Corporation (NYSE:OXY) were among the biggest gainers, with the latter up more than 6%.
Financials, meanwhile, were also a drag on the broader market led by Signature Bank (NASDAQ:SBNY), as the cryptocurrency-exposed bank reported a fall in deposits following a rout in crypto markets.
Regional banks, meanwhile, were also nursing losses, adding to pressure on the sector amid growing bets of an economic slowdown following weaker economic growth reported in China overnight.
“Our conviction is that the chances of an outright recession in 2022 remain low,” Wells Fargo said in a note. “However, the probability has risen substantially that the economy could suffer a 2023 contraction.”
Consumer discretionary stocks were the biggest drag on the market, paced by a more than 4% fall in Tesla (NASDAQ:TSLA).
Big tech traded mixed, with Apple (NASDAQ:AAPL), Alphabet (NASDAQ:GOOGL) and Amazon (NASDAQ:AMZN) in the red, while Facebook (NASDAQ:FB) and Microsoft (NASDAQ:MSFT) were up more than 1%.
Twitter (NYSE:TWTR), meanwhile, shed more than 7% as investors seemingly price in the prospect of Elon Musk lowering his $44 billion to take the company private, or ultimately walking away from the deal.
Musk said last week the deal to buy Twitter was on hold, citing concerns about fake accounts on the social media giant.
The move was widely viewed as a gambit to negotiate a lower price, which if not accepted and results in Musk walking away, “then the stock would likely see a sub $30 level with a broken deal in this shaky market backdrop,” Wedbush said.
On the economic front, regional manufacturing data flagged added to worries about an economic slowdown after a reading of manufacturing activity in New York fell 36.2 points to negative 11.6 in May.
In other news, JetBlue Airways (NASDAQ:JBLU) fell 4% after tabling a $30 per share offer for Spirit Airlines (NYSE:SAVE) after its previous offer for the company was rejected.
McDonald’s (NYSE:MCD), meanwhile, fell 2% after announcing that it will sell its restaurants in Russia, leading to a $1.4 billion writeoff.
The wild swings on Wall Street, following a rebound last week, is expected to continue.
“We expect a range-bound, choppy glide path for stocks in the week ahead- with support still near the 30-month MA on the SPX (3825), and resistance toward the 4300-4500 range,” Janney Montgomery Scott said in a note.