The S&P 500 and Nasdaq finished lower Monday as semiconductor stocks retreated and investors weighed escalating U.S. economic pressure on Iran, political resistance to AI data centers, Nvidia’s upcoming earnings and a key inflation report, while financial stocks helped lift the Dow.
By yourNEWS Media Newsroom.
U.S. stocks ended mixed Monday, with losses in technology and semiconductor shares pushing the S&P 500 and Nasdaq lower while gains in financial companies helped the Dow Jones Industrial Average finish in positive territory.
Investors entered the week confronting several potential market-moving events, including Nvidia’s quarterly earnings, Wednesday’s Personal Consumption Expenditures inflation report and Federal Reserve Chair Kevin Warsh’s highly anticipated speech Friday at the Jackson Hole symposium.
Geopolitical and trade concerns added another layer of uncertainty.
The Trump administration announced Monday that it could dramatically broaden sanctions against countries continuing to conduct business with Iran as part of what officials have described as an “economic D-Day,” although Washington stopped short of immediately imposing the wider secondary penalties.
Technology stocks were among the session’s weakest performers.
Chipmakers sold off, dragging the Philadelphia SE Semiconductor index lower and weighing heavily on the S&P 500 Information Technology sector.
Nvidia declined ahead of its earnings report, while Micron Technology and Broadcom also fell.
Political resistance to the enormous data centers required for artificial intelligence development contributed to pressure on the sector.
Texas Gov. Greg Abbott delivered one of the strongest warnings yet from a Republican official to the AI data center industry, saying companies had “dug their own grave” and deserved the public opposition they were encountering after failing to secure sufficient support in affected communities.
Abbott this month ordered a pause on approvals for new data center projects through Texas’ grid interconnection process, citing concerns that rapidly increasing electricity requirements could threaten power reliability as local opposition to the facilities grows.
The expanding political debate over AI infrastructure has become an additional concern for investors already evaluating high valuations across the technology sector.
“The bigger worry we have is the hawkish rhetoric we’re starting to hear from politicians on AI and data centers,” said Ohsung Kwon, chief equity strategist at Wells Fargo. “We’ve been highlighting that as a big risk heading into the midterms.”
Financial shares provided a counterweight to the technology losses.
JPMorgan Chase and Visa advanced, helping keep the Dow in positive territory even as the broader S&P 500 and technology-heavy Nasdaq declined.
According to preliminary closing data, the S&P 500 fell 21.37 points, or 0.28%, to 7,653.00.
The Nasdaq Composite dropped 200.80 points, or 0.77%, to 25,979.66.
The Dow Jones Industrial Average gained 141.67 points, or 0.27%, finishing at 53,418.68.
Bond-market conditions were also receiving close attention after concerns about rising federal debt drove the 30-year Treasury yield to a 19-year high before the Treasury Department announced support measures last week.
CNBC reported Monday that Treasury Secretary Scott Bessent could use the department’s nearly $1 trillion General Account to help finance bond buybacks.
Despite those potential measures, the 30-year U.S. Treasury yield remained above 5%.
The volatility in long-term government debt has increased the importance of Warsh’s upcoming remarks at Jackson Hole, where investors will be searching for indications of how Federal Reserve policymakers view the Treasury’s efforts and the broader interest-rate outlook.
Markets are particularly sensitive to any signal concerning the Fed’s next move because higher long-term rates can place additional pressure on richly valued technology stocks.
Nvidia’s earnings represent another major test.
The AI chipmaker has become one of the most influential companies in the broader market, and investors will be watching closely for any evidence that its rapid growth is beginning to slow.
A disappointing outlook could revive concerns that valuations throughout the AI-related technology sector have climbed too far ahead of underlying growth.
“Nvidia needs to impress in order to keep one leg of the stock market stable, and Warsh needs to provide clarity on interest rates in order to keep the other leg stable,” said Richard Reyle, chief investment officer at Questar Capital Partners.
Investors will get another major piece of economic information Wednesday with the release of the Personal Consumption Expenditures report, the Federal Reserve’s preferred measure of inflation.
The report follows relatively benign consumer inflation data earlier this month that reduced expectations for an immediate interest-rate increase.
Traders are currently pricing in one 25-basis-point rate hike by the end of 2026, according to LSEG data.
Markets are therefore approaching the inflation report with questions not only about current price pressures but also about whether the Fed will need to tighten policy further before the end of the year.
Trade tensions with Canada provided another source of pressure Monday.
President Donald Trump warned that U.S. tariffs on Canadian cars, trucks and automotive components would rise to 50% beginning Jan. 1 after negotiations between Washington and Ottawa collapsed over the weekend.
Automakers Ford and General Motors both declined following the announcement.
Trucking company J.B. Hunt Transport also fell sharply.
The tariff threat comes as markets simultaneously assess the potential economic consequences of Washington’s widening confrontation with Iran.
The administration’s sanctions campaign is aimed at pressuring countries and companies that continue providing Tehran with access to oil revenue and international financial channels.
While broader penalties were not imposed Monday, the possibility that Washington could target foreign institutions doing business with Iran added uncertainty over global trade, energy flows and financial conditions.
Those risks combined with weakness in semiconductors and growing concern over the political future of AI infrastructure to weigh most heavily on growth stocks.
With Nvidia earnings, PCE inflation data and Warsh’s Jackson Hole address all scheduled this week, investors are now facing a concentrated series of events that could determine whether Monday’s technology-sector weakness remains contained or develops into a broader market pullback.
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