Stocks failed to hold on to early gains on Monday and ended almost flat as investors anxiously await the consumer price index report for July this week that will help them gauge how aggressive the Fed might be in its rate-hike policy. The S&P and Nasdaq ended in negative territory, while the Dow managed to close in the green.

How Did The Benchmarks Perform?

The Dow Jones Industrial Average (DJI) gained 0.1% or 29.07 points to close at 32,832.54 points. The blue-chip index had added as much as 306.49 points at its session highs but ended up giving up almost all the gains.

The S&P 500 declined 0.1% or 5.13 points to finish at 4,140.06 points. The index also recorded its third-straight day of declines. Although real estate, materials and communication services stocks gained, the technology sector was a big drag.

The Technology Select Sector SPDR (XLK) fell 0.9%. However, the Communications Services Select Sector SPDR (XLC) gained 0.6%, while the Real Estate Services Select Sector SPDR (XLRE) gained 0.7%.  Seven of the 11 sectors of the benchmark index ended in positive territory.

The tech-heavy Nasdaq slid 0.1% or 13.10 points to end at 12,644.46 points.

The fear-gauge CBOE Volatility Index (VIX) was up 0.66% to 21.29. Advancers outnumbered decliners on the NYSE by a 2.28-to-1 ratio. On Nasdaq, a 1.67-to-1 ratio favored advancing issues. A total of 11.01 billion shares were traded on Monday.

Investors Feel Jittery Ahead of Inflation Data

Markets opened in the green on Monday and stocks rallied initially but none of the three major indexes could not hold on to the gains as investors feel jittery ahead of the release of the consumer price index report for July later this week. Investors kept gauging if the Fed would continue with its steep rate hike policy in its September policy meeting.

Investors were hoping for a softer rate hike by the Fed in its September meeting after a slew of big companies announced their layoff plans, which gave them an impression that the labor market was softening and was evidence of a slowing economy.

However, the robust jobs report released last week has made it difficult for investors to digest the idea that the Fed could continue with its aggressive rate hike policy. This once again dented investors’ spirits, taking a toll on stocks. Tech stocks were the biggest sufferers. Shares of Apple, Inc. AAPL and Salesforce, Inc. CRM declined 0.3% and 0.2%, respectively.

Clean Energy Stocks Rally

Clean energy stocks were big gainers on Monday after the Senate passed the Inflation Reduction Act. The House is likely to pass the bill by the end of this week. The proposal includes billions of dollars reserved to combat climate change. On Monday, investors were also gauging the effects of this major healthcare, climate change, and tax package.

Shares of First Solar, Inc. FSLR gained 4.8%, while Ormat Technologies, Inc. ORA advanced 0.5%. First Solar carries a Zacks Rank #3 (Hold). You can see the complete list of today's Zacks #1 Rank (Strong Buy) stocks here.

Semiconductor Stocks Disappoint

Semiconductor stocks took a beating on Tuesday after NVIDIA Corporation NVDA announced weaker-than-expected revenues in its preliminary financial results for its second-quarter fiscal 2023. The company cited weaker-than-forecasted gaming revenue for the decline.

Shares of NVIDIA Corporation declined 6.3%. Other microchip stocks also took a hit following the announcement. Shares of Micron Technology, Inc. MU slid 1.6%, while Texas Instruments Incorporated TXN fell 0.8%.

No economic data was released on Monday.

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