BUSINESS
Investor sentiment remained cautious as geopolitical uncertainty and higher oil prices weighed on global equities. At the same time, attention is shifting toward corporate earnings and upcoming monetary policy decisions from major central banks.
Global equity markets ended lower on Monday as investors remained cautious over developments involving the United States and Iran while preparing for a busy week of corporate earnings from major U.S. companies.
Market sentiment was also influenced after Yemen's Iran-aligned Houthi movement announced plans to impose a naval blockade on Saudi Arabia. The statement came even as indications suggested that Washington and Tehran were interested in restarting diplomatic discussions to reduce tensions.
Oil prices moved higher during the session. Brent crude settled at $89.22 per barrel, up about 1.3%, while U.S. West Texas Intermediate crude finished at $83.23 per barrel, gaining 0.9% after reaching an intraday high of $85.39, its strongest level since June 12.
Rising energy prices added pressure to equity markets because they can increase operating costs for businesses and raise expenses for consumers.
Investors are also looking ahead to quarterly earnings from several large U.S. companies this week, including Intel and Alphabet. Market participants will be assessing whether company results continue to support this year's strong gains.
Semiconductor stocks showed signs of recovery, with the sector index advancing 0.6% after recording sharp losses in the previous session.
In U.S. trading, the Dow Jones Industrial Average fell 307.16 points (0.59%) to 51,839.26. The S&P 500 declined 14.41 points (0.19%) to 7,443.28, while the Nasdaq Composite edged down 12.17 points (0.05%) to 25,508.07.
Globally, MSCI's world stock index slipped 0.29%, and Europe's STOXX 600 index closed 0.3% lower.
U.S. Treasury yields increased as investors evaluated the effect of higher oil prices and ongoing geopolitical uncertainty. With few major U.S. economic reports scheduled this week, attention is shifting toward next week's Federal Reserve meeting, while the European Central Bank is also due to announce its latest policy decision later this week.
In currency markets, the U.S. dollar strengthened slightly against a basket of major currencies. Sterling eased after recent political developments in the United Kingdom, while spot gold prices finished modestly lower.
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