The Dow Jones Industrial Average fell on Monday, reversing some of last week’s gains as Treasury yields rose, signaling concerns about prolonged high interest rates. The S&P 500 slipped 0.18% to 5,853.98, while the Dow lost 344.31 points (0.8%), closing at 42,931.60. The Nasdaq Composite managed a 0.27% increase, ending at 18,540.01.

Consumer and homebuilder stocks were notably weak, with Target down 3.8% and Builders FirstSource off 5.2%. The yield on the 10-year Treasury increased by nearly 12 basis points to 4.19%, leading to speculation that the Federal Reserve may be slower to cut interest rates due to a resilient economy.

Earnings reports will be closely watched this week, with approximately 20% of S&P 500 companies scheduled to announce results. So far, 75% of the 14% of companies that have reported exceeded expectations, though analysts have lowered their earnings forecasts significantly.

Despite recent declines, market sentiment remains cautiously optimistic, with investors aware of potential volatility stemming from stretched valuations and geopolitical risks.