FX.co ★ US inflation could set the tone for S&P 500

US stocks were mixed on Monday. Energy stocks mostly showed positive growth, thanks to oil climbing to a six-week high. Bond yields, on the other hand, declined, while dollar remained practically unchanged against its other counterparts.

To be more specific, the S&P 500 fluctuated slightly, with the largest decline in health and tech stocks. Meanwhile, the drop in Moderna retained the Nasdaq 100 in negative territory.

CFRA chief strategist Sam Stovall said: "The market is mimicking historical downward patterns in September as it fluctuates due to the uncertainty surrounding higher oil prices (due to a new tropical storm in the western Gulf ), expectations of higher CPI and lower retail sales, as well as the prospect of higher taxes and to compensate for losses on the infrastructure project. "

This means that investors are monitoring US inflation as this is what they will base on when projecting the Fed's timing on rate hike and policy tapering. And Tuesday's report may show moderate US consumer prices in August.

Global stocks skyrocketed this year, thanks to robust earnings reports and fast economic recovery. But with estimates stretching and sentiment weakening in recent weeks amid fears that economic growth could stall because of the delta variant, retail and travel stocks have declined.

Nordea senior strategist Sebastian Gali wrote: "Since the beginning of last week, realism has started to set into global equity markets as a long list of shocks percolate through the markets leading to an accelerated slowdown in economic activity in the U.S., a more subdued rebound in Europe and an unknown slowdown in China where the regulatory crackdown and its impact on investments are yet to be measured."

Meanwhile, President Joe Biden's $ 3.5 trillion tax and spending plan is in trouble. Democrat Senator Joe Manchin has questioned the timing of the program and proposed that tax rates could be cut to increase the chances of the package being passed.

Other important events this week are:

- data on US CPI (Tuesday);

- Apple product launch (Tuesday);

- report on China retail sales, real estate prices and industrial production (Wednesday).