Wall Street starts new week lower as risk rally fades

• Major equity indexes open in negative territory following last week's rally.
• CBOE Volatility Index rises more than 10% on Monday.
• S&P 500 Materials Index falls more than 2% in early trade.

After gaining more than 3% last week, Wall Street's main indexes started the first day of the new week in the negative territory with risk aversion becoming the main market theme.

Investors turn cautious

Reflecting the dismal mood, the CBOE Volatility Index, Wall Street's fear gauge, is up more than 10% on a daily basis. As of writing, the Dow Jones Industrial Average and the S&P 500 were down 0.9% and 0.65%, respectively, while the Nasdaq Composite was losing 0.15%.

Among 11 major S&P 500 sectors, the Materials Index and the Financials Index are both falling 2.1% after the opening bell as the worst performers. On the other hand, the Healthcare Index is up 0.4% as the only sector in the positive territory.

Earlier in the day, US Treasury Secretary Mnuchin said that he was expecting employment numbers to improve as summer approaches. Moreover, Saudi Arabia announced that it will be lowering its oil output by an additional one million barrels per day in June to rebalance the market. Nevertheless, these developments failed to fuel another risk rally.