Wall Street Reels Again as Nasdaq Falls 1% and Chip Stocks Drop 2%
Market review: live updates, trends, indexes, stock prices, bonds, foreign exchange and commodities, and analyst recommendations
23:00 Another volatile day was recorded today on Wall Street. Although trading opened higher, continuing yesterday’s gains, the market quickly turned to panic and sharp declines. Those losses eased toward the close, and the Nasdaq fell by “only” 1%, while the S&P 500 dropped 0.3%. The Dow Jones finished with a slight gain. Adding fuel to the fire, U.S. President Donald Trump said the United States would “respond” after accusing Iran of downing an Apache helicopter that was patrolling over the Strait of Hormuz. The SOXX ETF, which fell 10% on Friday, surged yesterday and opened the day higher, then moved to losses of about 3%, which also eased in the final minutes of trading. The declines were led by stocks that had recently surged sharply, with Marvell Technology at the top, while Micron Technology, Intel, AMD and even Nvidia were also falling sharply. Wall Street continued its rotation today, as investors who fled technology stocks after Friday’s sharp selloff kept moving into more defensive and stable names. This was especially notable because at the same time the S&P 500 fell by about 1%, but 9 of the 11 sectors in the index were actually trading higher. Today the technology sector, XLK, lost more than 2%. Smart money moved into real estate, XLRE, health care, XLV, and consumer staples, XLB. The picture reflects a classic “flight to safety” rotation, with investors reducing exposure to the growth and AI stocks that have risen sharply this year and moving money into companies with relatively steady demand even in periods of economic slowdown or uncertainty. After money flowed on Monday into consumer staples companies such as Kleenex maker Kimberly-Clark, today there was strong demand for Home Depot and J.M. Smucker, maker of Jif peanut butter. The market is trying to understand what is happening. The catalyst for the AI stock selloff is not entirely clear, but Brian Jacobsen, chief strategist at Annex Wealth Management, estimated that recent capital-raising moves by technology giants and the expected entry of new companies into the market may be contributing to the ongoing declines. According to him, Alphabet’s latest capital raise and the upcoming IPO of SpaceX may be affecting market sentiment. “There may be a lot of truth to the idea of technology trading as an ‘Icarus trade’ , the wings are starting to melt,” he wrote. He explained that when giant companies raise capital through offerings or share issuance, it can dilute existing shareholders. “Alphabet sent the first warning. Now there are ‘new toys’ for traders to play with, and the money has to come from somewhere,” he added. In other words, under this view, the market is not reacting to specific negative news, but to a deeper change in capital structure and risk appetite around AI trading, after an especially sharp and prolonged rally in the major technology stocks. It is also worth noting that the consumer price index will be released tomorrow. U.S. inflation is expected to cross 4% for the first time in three years, and the negative implications of that move may be felt throughout the rest of the year. First, any chance of a near-term rate cut by the Fed is expected to disappear. The central bank may even raise borrowing costs during 2026, which would be bad news for businesses, prospective homebuyers and consumers who need loans. If inflation does indeed move back above 4%, the market is expected to shift from debating “when will there be a rate cut” to debating “whether another rate hike will be needed.”
22:31 Alongside the easing of losses on Wall Street, oil prices also moderated and were down 3% to $91.5 a barrel for Brent and $88 for WTI crude, following Trump’s promise to respond to Iran’s downing of the helicopter. Earlier, oil prices had fallen sharply after signs of a recovery in traffic through the Strait of Hormuz. U.S. crude oil (WTI) was down about 4% to $87.7 a barrel, while Brent lost about 3.5% and traded around $90.9 a barrel. Traders expect shipping traffic through the Strait of Hormuz to pick up soon. For the market, that means the fear of a prolonged disruption to oil supplies from the Persian Gulf is beginning to ease. The Strait of Hormuz is one of the world’s most important energy routes, and a significant share of global oil exports passes through it. JPMorgan analysts also recently noted that the amount of oil flowing through the strait may be higher than can be seen in public data, in part thanks to quiet coordination by the U.S. with some of the tankers seeking to leave the Persian Gulf. For markets, lower oil prices are positive news, as they reduce fears of higher inflation, ease pressure on bond yields, support consumer and technology stocks, and reduce the risk of further Fed rate hikes.
21:39 Wall Street’s rotation continues, as investors fleeing technology stocks after Friday’s sharp selloff keep moving into more defensive and stable names. This is especially notable because at the same time the S&P 500 was down about 1%, yet 9 of the 11 sectors in the index were trading higher. Today the technology sector, XLK, is losing more than 2%. By contrast, the sectors surging are real estate, XLRE, health care, XLV, and consumer staples, XLB. The picture reflects a classic “flight to safety” rotation, with investors reducing exposure to the growth and AI stocks that have risen sharply this year and moving money into companies with relatively stable demand even during periods of economic slowdown or uncertainty. After money flowed on Monday into consumer staples companies such as Kleenex maker Kimberly-Clark, today there is strong demand for Home Depot and J.M. Smucker, maker of Jif peanut butter.
21:27 Apple’s stock is also trading lower today. Yesterday, the first day of the company’s annual WWDC developers conference, it fell about 2% after investors were disappointed by the company’s AI announcements and worried it was lagging in the AI race. Apple’s main message at the conference was that it is not falling behind in artificial intelligence, but Wall Street’s initial reaction was muted. Despite the visually impressive demonstrations, many analysts felt the company did not present a game-changing breakthrough. Analysts said no clear path was shown to generate significant revenue from AI, that Apple continues to rely on Google Gemini rather than presenting a leading independent solution, that there are very few use cases in which integration among Apple apps provides a meaningful advantage, and that Siri saw some improvement, but still remains below other leading language models. The main criticism is that WWDC was supposed to be the event in which Apple proves that Apple Intelligence will drive a new wave of iPhone upgrades, but according to some analysts that story is now less convincing than before. For investors, the concern is that Apple is still not seen as a leader in the AI revolution, compared with Alphabet, Microsoft, Nvidia and OpenAI. That is why the market reacted with disappointment, the problem is not that Apple failed to introduce innovations, but that it failed to convince Wall Street that it has a clear competitive edge in the age of artificial intelligence.
20:46 Wall Street is having another volatile day. Although trading began with gains, following yesterday’s advance, the market quickly shifted to panic and sharp declines. Those losses are now easing, the Nasdaq is down “only” 1.5%, and the S&P 500 is down 0.8%. The market is trying to understand what is happening. The catalyst for Tuesday’s AI stock selloff is not entirely clear, but Brian Jacobsen, chief strategist at Annex Wealth Management, estimated that recent capital-raising moves by technology giants and the expected entry of new companies into the market may be contributing to the ongoing declines. According to him, Alphabet’s latest capital raise and the upcoming IPO of SpaceX may be affecting market sentiment. “There may be a lot of truth to the idea of technology trading as an ‘Icarus trade’ , the wings are starting to melt,” he wrote. He explained that when giant companies raise capital through offerings or share issuance, it can dilute existing shareholders. “Alphabet sent the first warning. Now there are ‘new toys’ for traders to play with, and the money has to come from somewhere,” he added. In other words, under this view, the market is not reacting to specific negative news, but to a deeper change in capital structure and risk appetite around AI trading, after an especially sharp and prolonged rally in the major technology stocks. It is also worth noting that the consumer price index will be released tomorrow. U.S. inflation is expected to cross 4% for the first time in three years, and the negative implications of that move may be felt throughout the rest of the year. First, any chance of a near-term rate cut by the Fed is expected to disappear. The central bank may even raise borrowing costs during 2026, which would be bad news for businesses, prospective homebuyers and consumers who need loans. If inflation does indeed move back above 4%, the market is expected to shift from debating “when will there be a rate cut” to debating “whether another rate hike will be needed.”
19:51 Losses on Wall Street are deepening as the roller coaster in chip stocks continues. The Nasdaq is down more than 3% and the S&P 500 is down 1.8%. Adding fuel to the fire, U.S. President Donald Trump said moments ago that the United States would “respond,” after accusing Iran of downing an Apache helicopter that was patrolling over the Strait of Hormuz. The two pilots involved in the incident are “safe and wounded,” Trump wrote in a post on Truth Social. “However, the United States must, out of necessity, respond to this attack.” The SOXX ETF, which fell 10% on Friday, surged yesterday and opened the day higher, but has now moved to losses of about 7%. The Nasdaq is off about 2.8% and the S&P 500 is down 1.7%. The easing of tensions between the U.S. and Iran is not helping, and investors are also nervous ahead of tomorrow’s consumer price index release. The declines are being led by stocks that had recently surged sharply, with Marvell Technology down about 14%, while Micron Technology, Intel, AMD and even Nvidia are also falling sharply. Trading is marked by a clear rotation out of technology stocks, the sector that led this year’s gains, and into more defensive sectors. Six of the 11 S&P 500 sectors were trading higher, led by consumer staples and health care, which are seen as relative safe havens during periods of uncertainty. At Wells Fargo, the sharp selloff in technology stocks on Friday is seen as a kind of wake-up call for investors. “The sugar rush that powered the market’s sharp rally is probably behind us, which is why we are not enthusiastic about investing in stocks today,” the bank said. The comments reflect growing concern on Wall Street that the sharp gains in AI and chip stocks had run ahead of improvement in economic data and company profits. At the same time, options traders remain on edge after the sharp volatility seen in recent days. The main concern now is that tomorrow’s CPI report will trigger another round of sharp swings in the markets. Tomorrow’s CPI report is expected to show that core inflation, excluding food and energy, rose 0.3% in May from April. That would be a moderation from April’s 0.4% increase, but it would still be a relatively high monthly pace that is not consistent with the Fed’s inflation target. After last week’s strong jobs report and the jump in bond yields, the market is now looking for proof that price pressures are not getting out of control. Even a small miss versus forecasts could trigger a sharp market reaction. If inflation is higher than expected, bond yields could continue rising. Expectations of a Fed rate hike would strengthen and technology and growth stocks could come under additional pressure. On the other hand, a milder reading could restore risk appetite and ease the pressure that has built up over the past week.
19:06 Oil prices are falling sharply after signs of a recovery in traffic through the Strait of Hormuz. U.S. crude oil (WTI) is down about 4% to $87.7 a barrel, while Brent is losing about 3.5% and trading around $90.9 a barrel. Traders expect shipping traffic through the Strait of Hormuz to pick up soon. For the market, that means the fear of a prolonged disruption to oil supplies from the Persian Gulf is beginning to ease. The Strait of Hormuz is one of the world’s most important energy routes, and a significant share of global oil exports passes through it. JPMorgan analysts also recently noted that the amount of oil flowing through the strait may be higher than can be seen in public data, in part thanks to quiet coordination by the U.S. with some of the tankers seeking to leave the Persian Gulf. For markets, lower oil prices are positive news, as they reduce fears of higher inflation, ease pressure on bond yields, support consumer and technology stocks, and reduce the risk of further Fed rate hikes.
18:06 Canadian payments company Nuvei is in advanced talks to acquire international payments company Payoneer in a deal valued at about $2.7 billion. According to the report, the purchase price includes the cash in Payoneer’s treasury, so the enterprise value is estimated at about $2.3 billion. If the deal is signed on the reported terms, it would represent a significant premium to Payoneer’s current market value of about $1.7 billion, or nearly 60%. Payoneer, headquartered in New York, specializes in cross-border payments for freelancers, online sellers and small businesses. A large share of its revenue comes from customers in emerging markets selling to clients in the United States and Europe. The company was founded in Israel and employs several hundred people there after merging with a SPAC and beginning to trade in 2021 at a valuation of $3.3 billion. However, the company has faced several challenges recently, including trade tensions between the United States and China, and a high dependence on customers in Greater China, which accounted for about 34% of revenue in 2025. Profitability has also eroded. Although revenue grew 8% last year to $1.05 billion, net income fell 40% to just $73.2 million, mainly because of lower interest income and higher operating expenses. For Nuvei, the acquisition could significantly strengthen its international payments business and increase exposure to global commerce and small and midsize businesses.
18:00 After a strong open, the gains are reversing on Wall Street and the Nasdaq has turned down about 1%. The S&P 500 is down 0.3%, but the picture within the index is different, while the technology sector is losing 1.3%, the other ten sectors are trading higher, especially real estate and health care. Energy stocks are also down.
16:56 Wall Street is recovering for a second day from Friday’s black, or red, day, when the Nasdaq plunged 4%, the largest point decline in history. Leading the gains on Wall Street is the chip sector, with Micron jumping about 5% after already rebounding about 10% yesterday, following a drop of about 20% over the two days through the end of last week. Qualcomm is up about 3% and continues to recover from Friday’s sharp 11% drop. The SOXX chip ETF is up about 2% after surging 6% yesterday. On Friday, the fund fell 10%, its worst day in six years. It is worth watching DRAM, the ETF on memory chip stocks, which is jumping about 4% and has doubled since its launch in April this year.
16:45 The U.S. bond market is sending a clear message to the new Fed chair, Kevin Warsh, rates are still not high enough. The clearest sign is the two-year Treasury yield, which is considered the most sensitive to rate expectations. The yield has jumped to about 4.15%, a more than one-year high, while the Fed’s official policy range currently stands at 3.5% to 3.75%. In other words, the bond market is already pricing in higher rates than those in place today. The move strengthened especially after the stronger-than-expected jobs report, which showed that the U.S. labor market remains solid despite high interest rates. Following the data, traders began pricing in a quarter-point rate hike as early as October. Investors’ main concern is twofold: high energy prices resulting from the war with Iran could bring back inflation pressures, and the boom in artificial intelligence investment could overheat the economy and increase demand. As a result, markets are increasingly expecting the Fed to tighten monetary policy again to prevent overheating. The situation presents a challenge for Warsh. Before taking office, he hinted repeatedly that monetary policy was already restricting economic activity and that there was room for easing in the future. Now he faces a bond market signaling the opposite, that the Fed may be “behind the curve” in the fight against inflation. Attention is now on the inflation data due out over the next two days, the CPI and the Producer Price Index. U.S. inflation is expected to cross 4% for the first time in three years, and that development could affect the economy and markets for the rest of the year. Weaker-than-expected data could calm markets somewhat and reduce pressure for another rate hike. However, even if inflation comes in below forecasts, the bond market’s main message right now remains clear: investors think the U.S. economy is still too strong, inflation is still too high, and the odds of a rate hike have risen significantly compared with what the market believed just a few months ago.
16:30 Trading on Wall Street opened on a positive note, as chip stocks once again continued to recover from Friday’s collapse and oil prices retreated amid growing optimism for a near-term deal between the United States and Iran. The S&P 500 is up about 0.4%, and the Dow Jones is adding about 0.2%. Meanwhile, oil prices continue to fall, U.S. crude oil (WTI) is losing nearly 2% and is trading below $90 a barrel. The trigger is Trump’s comments that a deal between the United States and Iran could be signed within “two or three days,” and that the opening of the Strait of Hormuz could happen immediately. However, the geopolitical picture remains far from stable. Iran said it had halted attacks against Israel, but warned it would resume action if Israel continues its operation in Lebanon. On the other hand, Israel’s prime minister said the confrontation with Iran and Hezbollah “is not over yet.” For markets, the message is clear, investors are buying back chip and AI stocks after the sharp selloff, while also pricing in a scenario of easing in the Middle East. If a deal with Iran is reached and the chip recovery continues, the two factors that weighed on the market last week, oil and technology, could turn into major sources of support.
13:05 European stock markets are trading mixed at this hour. The DAX is up 0.6%, the FTSE is down 0.4% and the CAC is adding 0.7%. At the same time, futures on Wall Street are green and point to gains of up to 0.7% at the opening. Oil prices are down by as much as 2%. Brent is trading around $92 a barrel, while U.S. crude oil (WTI) has fallen below $90 a barrel.
9:40 In Asia, trading is taking place higher this morning. The Tokyo Stock Exchange is up about 1.9%, the Hong Kong exchange is up about 0.2%, the Shanghai exchange is rising 1.1%, and the Seoul market jumped 8.2%, led by chip stocks Samsung and SK Hynix, which are up about 9% and 12%, respectively. This, as noted, is against the backdrop of the recovery in the chip sector in the United States. Meanwhile, futures on Wall Street are up by as much as 0.6% this morning. Against the backdrop, U.S. President Donald Trump commented overnight on the war against Iran and said, “We are negotiating now, and they want to make a very good deal. They are willing to give us everything, they are willing not to have nuclear weapons... over the next two weeks we will announce total victory. It will be total victory, it will happen very soon, and oil prices will plunge.”
Wall Street
After the sharp declines recorded last Friday, the first trading day of the week ended mixed, with a recovery seen mainly in the chip sector. The Nasdaq rose about 0.9%, the S&P 500 added about 0.3% and the Dow Jones slipped 0.2%. While the S&P 500 saw some recovery, beneath the surface it was clear that market breadth, the share of stocks participating in the gains, remained low. According to FactSet data, by the end of trading day, 306 stocks in the S&P 500 were trading in the red, meaning that more than 60% of the benchmark’s constituents fell. In fact, while the technology sector led gains and strengthened by about 1.5%, eight of the 11 sectors in the S&P 500 finished the day in the red. The Philadelphia Semiconductor Index (SOXX) jumped sharply by about 5.7%, after plunging more than 10% on Friday and posting its weakest day in six years. Among the stocks that climbed were Micron, Nvidia, Broadcom and Marvell, along with many others. Intel jumped sharply after a report on The Information said several chip companies, including Google and Nvidia, are turning to the company as a second foundry, amid Taiwan’s TSMC struggling to produce enough manufacturing lines to meet the surging demand for AI chips. Shares of Cerebras, which last month completed one of the largest initial public offerings on Wall Street in recent years, rose nearly 20% after receiving a wave of buy recommendations from a number of major investment banks, including Barclays, Citibank, Morgan Stanley, UBS and others. In Israeli stocks on Wall Street, internet company Wix revised down its revenue growth forecast for this year, but left unchanged its free cash flow forecast, excluding costs related to acquisitions and restructuring. Following the report, the stock fell in Wall Street trading to its lowest level in more than nine years. As a reminder, the company recently announced layoffs of 20% of its employees, about 1,000 people, saying this was due to the strengthening of the shekel against the dollar and developments in AI that require it to become a faster and leaner company. Overnight, OpenAI announced that it had filed a confidential prospectus with the U.S. Securities and Exchange Commission, a first step toward a possible Wall Street listing. The move places the maker of ChatGPT alongside Anthropic, which also filed a confidential prospectus last week, while Elon Musk’s SpaceX is already at a more advanced stage after publishing a public prospectus ahead of an IPO, at a valuation of about $1.8 trillion, and is expected to begin trading this Friday. According to estimates, OpenAI is currently worth more than $850 billion, following a funding round completed earlier this year. At the same time, the company also plans a secondary tender offer that will allow employees to sell shares at the current valuation, thereby providing liquidity to shareholders without waiting for an IPO.
U.S. bond market
In the U.S. debt market, Treasury yields climbed, especially at the longer end of the curve. This morning too, yields are posting slight gains, with the 10-year yield at 4.56% and the 30-year yield at 5.03%. The move comes amid tensions in the Middle East, as well as the slim expectations for a near-term interest rate cut in the United States.
Macro
At the opening of the trading week and the short-lived escalation in the Middle East, Dr. Ilan Gildin, hedge fund manager at Karny Family Office and a former economist for the Israel Securities Authority, says that “regional geopolitical escalation is becoming a routine event,” and that the situation is “very delicate and subject to spontaneous flare-ups.” According to him, the current flare-up found the markets at a sensitive point. Referring to the strong U.S. jobs data, Gildin says they “put Fed Chair Kevin Warsh between a rock, an antagonistic Board of Governors, and a hard place, a White House that does not want to hear about rate hikes.” He also added that “the combination of a strong economy together with an immediate spike in energy prices because of the war creates double inflationary pressure.” It should be noted that tomorrow, Wednesday, the U.S. consumer price index for May is expected to be published, and it is expected to have an important impact on the Federal Reserve’s interest rate decision next Wednesday. After the index showed an annual increase of 3.8% in April, economists expect it to rise by about 4.2% in May. If May’s index shows a larger-than-expected increase, it could strengthen expectations for higher rates for longer. In its weekly review, the investment house Psagot said economists referred to the most significant division among Federal Reserve members in several decades. The latest rate decision was made with four dissenters out of 12 voting members, the most since October 1992. “Among the 12 committee members today, there are three who are clearly hawkish, Logan, Kashkari and Hammack, who already voted in April to abandon the easing bias. Hammack even recently emphasized that if current trends continue, ‘it may be appropriate to act soon,’” Psagot wrote. “On the other hand, there are also three clearly dovish members, Bowman, Paulson and Williams. The remaining six members can be classified as ‘swing voters,’ and Fed policy in the coming months depends on them. Of these, three, Cook, Jefferson and Waller, said they would support a hike if inflation does not fall soon. This leaves us with the understanding that if inflation indeed does not moderate, it is enough for just one of the other three, Warsh, Powell or Barr, to tilt hawkish for the hawks to already have a seven-vote majority and for the rate hike decision to move forward.” “What could prevent that? Of course, the first possibility is a deal between the United States and Iran that would lead to lower oil prices,” Psagot added. “Another possibility is that Warsh will succeed at the upcoming meeting in justifying his selection as chair and convincing the swing group to wait with the decision. If he manages to do that until after the midterm elections, Trump will כמובן be very pleased.”
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