NEW YORK (CNNMoney) -- Investors were on edge Monday ahead of two big meetings by U.S. and European central banks.
Expectations are high for the U.S. Federal Reserve and the European Central Bank to announce new measures to boost the economy when they meet later this week. The Fed's two-day meeting culminates in an announcement on monetary policy Wednesday.
Once the Fed wraps up, the ECB will take center stage, with its Governing Council meeting in Frankfurt on Thursday. Last week ECB president Mario Draghi said the central bank would do "whatever it takes" to preserve the euro. Investors now want to see if he'll put those words into action.
"The markets are very sensitive to the commentary that comes the central banks, and that will be the big focus this week," said Hamed Khorsand, analyst at BWF Financial. "But I think we'll just hear a lot more promises -- no action."
Ahead of the meetings, U.S. Treasury Secretary Timothy Geithner is scheduled to meet with German finance minister Wolfgang Schaeuble and Draghi on Monday, although no press statement is expected.
While the central bank meetings will be the the forefront, investors will also be digesting all the earnings results that have come out over the past couple of weeks, and those that are due in the week ahead, said Khorsand.
Nearly 60% of the S&P 500 have already reported, and results have been lackluster. Excluding the financials sector, second quarter earnings are expected to decline 0.4%, according to Thompson Reuters, makring the end to a ten-quarter winning streak.
Stocks rallied Friday on talk that the ECB may intervene in the bond market to ease borrowing costs for Spain and Italy.
The Dow Jones industrial average ended above 13,000 for the first time since early May. The S&P 500 also ended at its highest level since May.
Spain's economy continued to shrink for a third straight quarter. The struggling country's GDP fell 0.4% during the second quarter.
Spain has been in the spotlight thanks to its high debt and soaring borrowing costs. The Spanish 10-year yield neared 8% last week, but has since pulled back amid hopes that the ECB will intervene to help bring down the country's borrowing costs.
Italy sold €5.48 billion of bond 3-, 5- and 10-year government notes, slightly less than the €5.5 billion target. Yields fell in comparison to a previous auction, with the benchmark 10-year yield easing to 5.96% compared to 6.19% a month ago.
Companies: Shares of HSBC ( ) were slightly lower in premarket trading, London-based HSBC said it put aside about $2 billion to compensate U.K. customers for misselling of payment-protection insurance, and to pay costs in the U.S. related to accusations it failed to prevent billions of dollars worth of money transfers linked to drug cartels and terrorist groups.
Apple (Fortune 500) and Samsung begin their patent battle in court Monday. Apple filed a lawsuit against Samsung last year alleging that the company's smartphones and tablets are knockoffs of its iPhone and iPad, and an infringement on its patents. Apple is seeking $2.5 billion in damages.,
Oil for September delivery dipped 23 cents to $89.90 a barrel.
Gold futures for August delivery fell 70 cents to $1,617.30 an ounce.
Bonds: The price on the benchmark 10-year U.S. Treasury fell slightly, and the yield edged up to 1.56%.
|What we want Apple to unveil at WWDC|
|Millennials squeezed out of buying a home|
|7 traits the rich have in common|
|Big Data knows you're sick, tired and depressed|
|Your car is a giant computer - and it can be hacked|
|Overnight Avg Rate||Latest||Change||Last Week|
|30 yr fixed||3.41%||3.40%|
|15 yr fixed||2.69%||2.68%|
|30 yr refi||3.42%||3.43%|
|15 yr refi||2.70%||2.71%|
Today's featured rates: