The S&P 500 concluded Monday's trading session with minimal change, as a surge in oil prices, driven by ongoing uncertainty surrounding Iran, offset a downturn in the technology sector, particularly among chipmakers. The benchmark index closed slightly below breakeven, reflecting a market caught between escalating geopolitical tensions and resilient economic fundamentals.
Intel emerged as a significant drag on the semiconductor industry, with its stock falling sharply after the company announced plans to issue $15 billion in common stock. This move aims to fund its expansion efforts in advanced chip manufacturing and artificial intelligence technologies. Other tech giants like Nvidia and Apple also experienced declines, contributing to the pressure on the Nasdaq.
Meanwhile, oil prices climbed, with U. S. West Texas Intermediate crude futures rising approximately 5.1% to $82.13 per barrel and Brent crude futures increasing by 5% to $87.72 per barrel. This rise is attributed to market concerns over potential supply disruptions stemming from the situation in the Middle East. Iran indicated it was nearing an agreement with Oman to reopen the Strait of Hormuz, but simultaneously reiterated demands for the U. S. to lift sanctions and provide compensation, tempering optimism for a swift resolution. Foreign Minister Abbas Araghchi stated that resuming talks with the U. S. was impossible under current conditions.
The market's cautious stance was also influenced by President Donald Trump's comments suggesting the U. S. was only in "half-negotiation mode" with Iran, emphasizing a desire for continued economic pressure on the country. Analysts noted that while Middle East tensions often cause market fluctuations, the scale of recent flare-ups has been comparatively smaller, a factor that may have contributed to the market's ability to absorb the news amidst strong overall earnings season fundamentals.
