The S&P 500 ended nearly flat on Monday, with bank shares falling amid warnings of potential losses - to the tune of billions of dollars - from a hedge fund's default on margin calls.
Still, optimism over the economy limited the day's declines with the Dow rising roughly 100 points while the S&P slipped and the Nasdaq fell.
Nomura and Credit Suisse face billions in losses after a U.S. investment fund, named by sources as Archegos Capital, defaulted on margin calls, putting investors on edge about who else might have been caught in the situation.
Susan Schmidt - Aviva Investors' head of U.S. equities - says so far this is a contained event.
"Everyone immediately jumps to concerns over the ripple effect, how does this ripple through the rest of the market. Right now we do seem to think this is an isolated event. You're going to have interim dislocation but things should right themselves and that's because we have a contained event. We have a hedge fund that was highly leveraged and we're seeing positions unwind as a result."
Media companies such as Discovery, ViacomCBS plus the U.S.-listed shares of Baidu, all linked to Archegos, ended lower, extending recent losses.
Meanwhile shares of planemaker Boeing rose - helping lift the Dow - after the company said on Monday it sold 100 new 737 MAX-7 jets to long-time customer Southwest Airlines, in its biggest order win since the aircraft's safety ban was lifted in the U.S. last year.