U.S. stocks were mixed in late trading on Monday, with the Nasdaq and S&P 500 dragged lower by a broad decline in semiconductor shares. The Dow Jones Industrial Average rose 123.84 points, or 0.24%, to 52,071.09, while the Nasdaq fell 101.10 points, or 0.40%, to 24,874.73. The S&P 500 dropped 11.56 points, or 0.16%, to 7,400.42.
The S&P 500 declined on Monday, as a sharp selloff in chip stocks outweighed an earlier rally spurred by falling global oil prices. The broad market index was last down 0.2%, while the Nasdaq Composite slid 0.5%. The Dow Jones Industrial Average added 138 points, or about 0.3%.
Semiconductor stocks were broadly lower. The VanEck Semiconductor ETF (SMH) fell more than 3%, extending its decline from Friday. AMD and Teradyne led the sector lower, dropping 7% and 5%, respectively. Micron Technology declined about 4%, and SanDisk fell more than 14%.
Chipmakers had edged higher earlier in the session after Chinese chipmaker ChangXin Memory Technologies made a blockbuster initial public offering on the Shanghai Stock Exchange on Monday. Separately, analysts noted that U.S. stock traders are rebalancing their portfolios amid signs that the artificial intelligence bubble is "deflating," particularly as equities remain below the record highs set in late June.
Easing tensions in the Middle East pushed oil prices lower. International benchmark Brent crude futures for September delivery fell 6.8% to around $90.25 per barrel, while U.S. West Texas Intermediate crude futures dropped 6.1% to $83.83 per barrel.
Major indexes face a challenging week ahead. Following Alphabet's disappointing quarterly results last week, Amazon, Apple, Meta Platforms, and Microsoft are set to report their earnings. These reports will either ease or intensify investor concerns about the massive spending on artificial intelligence, which could directly impact semiconductor companies that are the primary beneficiaries of the AI spending boom.
The Federal Reserve is set to announce its latest interest rate decision on Wednesday. While the market widely expects the Fed to raise rates in September, according to the CME FedWatch Tool, market pricing suggests a significant probability of a 25-basis-point hike in the benchmark borrowing rate as early as this week.
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