By Caitlin Ostroff and Akane Otani
U.S. stocks wobbled between small gains and losses Monday, pressured by declines in shares of energy companies.
The Dow Jones Industrial Average inched up 5 points, or less than 0.1%, to 32783, adding to its advance after finishing last week at a record. The S&P 500 fell less than 0.1%, and the Nasdaq Composite rose 0.2%.
Shares of economically sensitive companies have led the stock market higher this month, a trend investors have attributed to bets that growth and inflation will pick up. The vaccine rollout has proceeded faster than expected, making investors more optimistic about the outlook for the second half of the year. Congress has also passed an additional $1.9 trillion in fiscal stimulus to help boost the economy.
"With the reopening of the economy, this fiscal stimulus in the form of checks will have a stronger impact on consumption," said Carsten Brzeski, ING Groep's global head of macro research.
Later this week, investors will parse the Federal Reserve's monetary policy statement for guidance on policy makers' views on the economic outlook.
"The Fed meeting will clearly be crucial and essential in terms of further educating markets as to what the Fed is up to," Mr. Brzeski said.
Sliding oil prices put pressure on the energy sector Monday.
Occidental Petroleum lost 5.1%, while ConocoPhillips declined 3.3%. U.S. crude oil fell 1.6% to $64.57 a barrel, extending losses after notching its biggest one-week decline since December.
AMC Entertainment soared 27%, boosted by news that it is reopening movie theaters in Los Angeles this week.
Meanwhile, a handful of stocks rose after S&P Dow Jones Indices said late Friday that they would be joining the S&P 500 effective March 22. Shares of Caesars Entertainment climbed 0.7%, while NXP Semiconductors added 8.3% and Penn National Gaming gained 3.1%.
Government bonds strengthened, with the yield on the 10-year U.S. Treasury note ticking lower to 1.613%. It ended Friday at 1.634%, the highest since Feb. 6, 2020. Yields fall as bond prices rise.
Some money managers are worried that a large fiscal package could lead to sharply higher inflation, forcing the Fed to boost interest rates sooner than policy makers have suggested they would.
"The Fed needs to send a message here that it is still mindful of the substantial progress that is required before the economy is returned to pre-pandemic conditions, but equally, it's not going to be too forceful because some of these moves are warranted based on fundamentals," said James Ashley, head of international market strategy at Goldman Sachs Asset Management. "So it is, how do you calibrate that message in a way that is neither too dovish or too hawkish."
Overseas, the pan-continental Stoxx Europe 600 rose 0.2%.
Major equity benchmarks in Asia ended the day on a mixed note. The Shanghai Composite Index fell almost 1%, and South Korea's Kospi closed 0.3% lower. Japan's Nikkei 225 rose 0.2%, and Hong Kong's Hang Seng Index gained 0.3%.
Write to Caitlin Ostroff at caitlin.ostroff@wsj.com and Akane Otani at akane.otani@wsj.com
(END) Dow Jones Newswires
03-15-21 1142ET
