The stock market began the week on a flat note as participants displayed a lack of conviction ahead of key policy statements from the Federal Reserve and Bank of Japan. The Nasdaq Composite (-0.2%) settled behind both the Dow Jones Industrial Average (UNCH) and the S&P 500 (UNCH). 

The major averages advanced at the start of the session as a rebound in crude oil futures and a positive bias in global markets facilitated a higher start to the trading week. Oil was in focus as renewed speculation surrounding a production cap agreement boosted the energy component. Venezuelan President Nicolas Maduro made headlines over the weekend, stating that oil producers are close to reaching a deal to stabilize oil markets. However, the comments were taken with a grain of salt following contradictory reports from OPEC Secretary General Mohammed Barkindo. The oil cartel is scheduled to meet on September 26-28.

The benchmark index notched a session high in the first half hour of trade, testing but failing to clear technical resistance near the 2150/2151 price level. The broader market walked back early gains through the session as the heavily-weighted technology (-0.2%) and health care (-0.4%) sectors came under pressure. The broader market notched a session low shortly after midday, but managed to settle above that level. Four sectors ended in the green with industrials (+0.3%), financials (+0.5%), and utilities (+1.0%) leading. Conversely, technology (-0.2%), health care (-0.4%), and telecom services (-0.7%) underperformed. 

The financial space (+0.5%) finished ahead of the benchmark index, rebounding from recent losses. Wells Fargo (WFC 46.01, +0.58) jumped 1.3% after Robert W. Baird upgraded the stock to Outperform from Neutral. The broader sector displayed relative strength as participants assessed the rate hike picture in coming months. The implied probability of a rate hike at the September meeting sits at 12.0% while the odds of a rate hike at the December meeting registers at 55.0%. Rate hike expectations increased last week following some firming inflation data. 

In the energy sector (-0.1%), refining names outperformed amid reports of gasoline shortages on the East coast of the United States. Phillips 66 (PSX 80.35, +1.26) and Tesoro (TSO 83.54, +1.56) ended higher by 1.6% and 1.9%, respectively. Separately, Dow component Chevron (CVX 98.04, +0.20) finished ahead of the price-weighted index. For its part, crude oil settled higher by 0.6% ($43.90/bbl; +$0.28).

Homebuilders outperformed in the consumer discretionary space (-0.1%), evidenced by the 0.9% gain in the iShares Dow Jones US Home Construction ETF (ITB 27.52, +0.25). The sub-group gained following a stronger-than-expected reading of the NAHB Housing Market Index for September. Lennar (LEN 45.09, +0.75) jumped 1.7% ahead of tomorrow morning's earnings report. Separately, General Motors (GM 31.72, +0.75) rallied 2.4% after being upgraded to "Overweight" at Morgan Stanley.

In the health care space (-0.4%), biotechnology gained after Sarepta Therapeutics (SRPT 48.94, +20.79) received conditional approval from the FDA for the company's muscular dystrophy treatment. On the flipside, Merck (MRK 61.33, -0.95) ended lower by 1.5%. 

On the M&A front, Infoblox (BLOX 26.35, +3.52) spiked 15.4% after announcing that Vista Equity Partners will acquire the company for $26.50 per share or approximately $1.6 billion. Separately, Isle of Capri (ISLE 22.04, +5.11) rallied 30.2% after Eldorado Resorts (ERI 13.84,- 0.41) agreed to acquire the name for $23.00 per share or approximately $1.7 billion.

Treasuries ended on a lower note with yields rising through the curve. The yield on the 2-yr note rose one basis point to 0.77% while the yield on the 10-yr note also increased one basis point (1.70%). 

Today's participation was below the recent average as fewer than 760 million shares changed hands on the NYSE floor.

Today's economic data was limited to the NAHB Housing Market Index for September: 

• The NAHB Housing Market Index for September rose to 65 from a revised 59 in August (from 60) while the Briefing.com consensus expected the reading to come in at 59.

Tomorrow's economic data will include Housing Starts (Briefing.com consensus 1186k) and Building Permits (Briefing.com consensus 1160k) for August, which will each be released at 8:30 ET. 

• Russell 2000: +8.5% YTD
• S&P 500: +4.7% YTD
• Nasdaq: +4.6% YTD
• Dow Jones: +4.0% YTD