U.S. stocks ended little changed in thin trading Monday and Treasuries ticked lower at the long-end of the curve as investors focused on corporate results and prospects for faster policy tightening by the Federal Reserve.

The S&P 500 closed down less than 0.1 per cent, after swinging between narrow gains and losses on volumes almost 20 per cent below the 30-day average in the first trading day following a long holiday weekend. Bank of America Corp. was poised for the biggest daily advance in more than a month as the bank joined a string of earnings beats by big lenders such as Morgan Stanley and Citigroup Inc. Markets in much of Europe were shut for Easter.

Treasury yields moved higher in longer maturities, as investors looked forward to speeches by Fed policy makers this week for new clues on whether the central bank will raise interest rates by a half point in May to curb price pressures. A jump in energy costs highlighted inflation concerns, as U.S. natural gas prices surged to the highest intraday level in more than 13 years. Oil climbed above US$108 a barrel in New York.

“Volumes are light on this Easter Monday, with many European markets closed and even more families on spring break,” said Art Hogan, chief market strategist at National Securities. “In that environment it doesn’t take much of a sentiment shift to produce a relatively out-sized move.”

In other market moves, Twitter Inc. rose the most in two weeks after the social media company launched a so-called poison pill to thwart Elon Musk’s unsolicited bid to take the company private and Musk said the economic interests of the board are not aligned with shareholders.

Twitter posted modest gains in after-hours trading following a report that Apollo Global Management Inc. has held discussions about backing a possible deal for Twitter either by backing the offer made by Musk or another bidder like private-equity firm Thoma Bravo.

“The alternating excited and depressed markets have been a boon for traders, but not so much for long-term investors,” Paul Nolte, portfolio manager at Kingsview Investment Management, wrote in a report. “Volatility is up, worries abound, so investors are looking at companies and sectors that can still do well no matter the outlook. If inflation continues to be one of those worries, look for commodity companies to continue their run higher as well.”

The pattern across markets suggests investors remain uncertain whether high inflation has peaked. Price pressures are being fanned by supply-chain snarls from China’s COVID restrictions and disruptions to commodity flows due to the war. Concern is growing that the U.S. economy faces a downturn as the Fed pivots toward aggressive policy tightening to contain the cost of living.

History suggests the Fed will face a difficult task cooling inflation without causing a U.S. recession, according to Goldman Sachs Group Inc. It put the odds of a contraction at about 35 per cent over the next two years.

The positive effects from inflation on earnings growth for U.S. firms have peaked as rising costs trim their margins and price pressures caused by the Ukraine war hit consumers, according to Morgan Stanley strategists.

A New York Fed survey showed potential home buyers are getting discouraged by rising mortgage rates and home prices.

Chinese data were mixed, adding to investor concerns about the country’s stalled economic recovery. In Shanghai, officials reported the first deaths from a surging COVID-19 outbreak. The city has also published plans to resume production after a prolonged lockdown, recommending businesses adopt so-called closed-loop management, where workers live on-site and are tested regularly.

Meanwhile, Ukrainian officials said the remaining defenders of Mariupol were encircled by Russian forces but have not surrendered the strategically important port city, as a deadly strike was reported in Lviv near the Polish border. Ukrainian officials will be in Washington for this week’s meetings of the International Monetary Fund and the World Bank to seek financial support.

More commentary

• “The kickoff of earnings season did little to change a familiar narrative for the market last week: Stocks continued to search for sustained upside momentum amid high inflation readings, interest rates on the rise, and dashed hopes for a cease fire in Ukraine,” said Chris Larkin, managing director of trading at E*Trade from Morgan Stanley. “And while we’re facing turbulent times, consider how the market has re-calibrated so far this year. The S&P 500’s recent pullback was relatively mild, but the VIX actually closed lower, which tends to suggest that volatility may have been priced in.”
• “Yield spikes have often spelled trouble for stocks, but we believe the past is an imperfect guide in a world shaped by supply shocks,” BlackRock Investment Institute strategists led by Wei Li, global chief investment strategist, said in a note. “We see central banks normalizing quickly - but not slamming the brakes on the economy. This should keep real yields low and underpin equity valuations.”

What to watch this week:

• Earnings include American Express, China Telecom, IBM, Johnson & Johnson, Netflix, Tesla
• Easter Monday market closures in the U.K., much of Europe
• IMF/World Bank spring meetings start, Monday
• St. Louis Fed President James Bullard to speak, Monday
• Chicago Fed President Charles Evans to speak, Tuesday
• EIA crude oil inventory report, Wednesday
• China loan prime rates, Wednesday
• Federal Reserve Beige Book, Wednesday
• French presidential election debate, Wednesday
• San Francisco Fed President Mary Daly, Chicago Fed President Charles Evans, due to speak, Wednesday
• Euro zone CPI, U.S. initial jobless claims, Thursday
• Fed Chair Jerome Powell, ECB President Christine Lagarde discuss global economy at IMF event, Thursday
• Manufacturing PMIs: Euro zone, France, Germany, U.K, Friday
• Bank of England’s Andrew Bailey to speak, Friday

Some of the main moves in markets:

Stocks

• The S&P 500 was little changed as of 4 p.m. New York time
• The Nasdaq 100 rose 0.1 per cent
• The Dow Jones Industrial Average fell 0.1 per cent
• The MSCI World index fell 0.3 per cent

Currencies

• The Bloomberg Dollar Spot Index rose 0.3 per cent
• The euro fell 0.2 per cent to US$1.0783
• The British pound fell 0.4 per cent to US$1.3011
• The Japanese yen fell 0.4 per cent to 126.95 per dollar

Bonds

• The yield on 10-year Treasuries advanced three basis points to 2.86 per cent

Commodities

• West Texas Intermediate crude rose 0.9 per cent to US$107.87 a barrel
• Gold futures rose 0.3 per cent to US$1,981.70 an ounce