Memory chip stocks pushed the Nasdaq Composite into positive territory Monday even as the Dow Jones Industrial Average dropped roughly 200 points. A stalled U.S.-Iran ceasefire deadline and a slide in Meta and Microsoft shares weighed on the broader market, while chipmakers such as SK Hynix and Micron kept climbing.
Chip rally offsets a falling Dow
The Nasdaq Composite rose 0.03% as of 12:26 p.m. ET, while the S&P 500 slipped 0.17% and the Dow Jones Industrial Average fell 0.31%, or roughly 200 points.
The Dow turned red minutes after the open and stayed there, but the Nasdaq spent most of the morning positive before drifting toward breakeven. Memory chipmakers drove that resilience: SK Hynix rose 6.5% and added roughly $83 billion in market value, while Micron Technology climbed 5.9% and rose back above $1,000 per share.
Nvidia added to the sector's strength. The chipmaker rose 0.9% on news it will finance up to $105 billion in credit and compute for an OpenAI data center in Pike City, Ohio, with the first 4.25 gigawatts of the 20-year project arriving in 2028.
Meta and Microsoft drag on hyperscaler worries
Not every large-cap name joined the rally. Meta Platforms dropped 3.3% ahead of Tuesday's opening arguments in a federal trial in Oakland, where 29 state attorneys general allege the company designed Facebook and Instagram to get children addicted. Microsoft was the S&P 500's biggest drag with a 2.4% drop, following a Morgan Stanley note warning that hyperscalers are spending heavily upfront on AI data center builds whose payoff may take years to show up.
A ceasefire deadline passes without a deal
The drag on the Dow came against a tense geopolitical backdrop. A June 17 memorandum of understanding between Washington and Tehran hit its 60-day deadline Monday with nothing signed. According to Reuters, a senior Iranian official said Tehran is going "fully offensive" and would use its military to break the U.S. naval blockade if talks fail.
Shipping through the Strait of Hormuz has essentially stopped, with three vessels crossing Sunday against roughly 130 daily before the war began in February. Brent crude rose 0.7% to $89.13 on the news, a quiet move by recent standards.
Markets climb a wall of worry
Under the surface, the Invesco S&P 500 Equal Weight ETF fell 0.58%, more than three times the cap-weighted index's drop, and decliners beat advancers by about 1.5-to-1 on the NYSE. Still, the S&P 500 sits within a whisper of last Thursday's record and is up 13.6% on the year, with second-quarter earnings tracking near 50% growth.
September rate hike odds have fallen to about 31% from roughly 50/50 a week earlier. That leaves this week's retail earnings to answer a bigger question: July retail sales fell for the first time in nine months and consumer sentiment dropped to 51.0, and some of the country's largest retailers are about to show whether that was a blip or a trend.
Source: The Motley Fool
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