Tech and AI stocks plunge, SpaceX loses $600B, as Dow rises on Iran deal hopes

Wall Street split sharply on Monday as the Dow rose 148 points on Iran peace progress while the Nasdaq plunged 1.3% and the S&P 500 fell 0.4%, hammered by a selloff in mega-cap AI and tech stocks. Alphabet sank 5%, Amazon 4.8%, Microsoft 3.2%, and SpaceX crashed 16.4%, wiping out $600 billion in three days after announcing its first bond sale. The selling has spilled into Tuesday, with Nasdaq 100 futures sliding 2.7% on rising skepticism over AI infrastructure spending and mounting expectations of a Fed rate hike later this year. Investors now await May PCE inflation data and Micron earnings for further direction.

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Nasdaq tumbles as Big Tech and SpaceX rout, Dow gains on Iran deal progress U.S. stocks closed mixed on Monday with the S&P 500 falling 0.37% to 7,473 and the Nasdaq Composite dropping 1.32% to 26,167, while the Dow Jones Industrial Average added 148 points to 51,875. The divergence reflects a sharp rotation out of megacap AI and growth stocks—Alphabet fell 5%, Amazon 4.8%, Microsoft 3.2%, and SpaceX plunged 16.4%—into cyclicals and small caps, supported by reports that U.S.-Iran peace talks are advancing with a 60-day roadmap for a final deal, sending oil prices lower. The selloff extended into Tuesday morning, with Nasdaq 100 futures down 2.7% and the S&P 500 futures sliding 1.5% as investor skepticism over AI infrastructure spending, rising bond yields, and a hawkish Fed outlook resurfaces. 1 2 3 4 5 6 7

SpaceX sheds $600 billion in three days after first bond sale Shares of Elon Musk’s SpaceX (SPCX) fell 16.4% on Monday, extending a three-day losing streak that has erased $600 billion in market capitalization since its June 12 IPO. The decline accelerated after the company confirmed its first-ever bond issuance, raising concerns about debt-funded AI spending. The stock is now up just 14% from its IPO price of $135. 8 9 10

Alphabet and Amazon lead AI spending anxiety as hyperscaler capex tops $452B Alphabet fell 5% and Amazon dropped 4.8% on Monday as investors fretted over a combined $452 billion in 2026 capital spending across hyperscalers, with free cash flow at Alphabet falling 47% and at Amazon crashing 95% year-over-year. Alphabet also faced talent retention worries after reports of key AI researchers departing to rivals Anthropic and OpenAI. The anxiety has spilled into Tuesday premarket, with Nvidia and other chip stocks sliding on reports that SK Hynix is slowing advanced AI chip production. 11 12 13

Micron jumps 7% before earnings, SK Hynix slow-down caps chip sector Micron Technology (MU) surged 7% on Monday after announcing a strategic agreement with AI firm Anthropic, ahead of its quarterly earnings due Wednesday. The broader chip sector showed mixed signals: Intel and AMD rose 5% and 2%, but sentiment soured after SK Hynix said it would slow production of advanced AI memory chips to boost commodity DRAM, fanning worries that AI infrastructure demand may be overestimated. 2 5

Iran oil-license and PCE data in focus as Fed rate-hike bets intensify Markets are watching for May PCE inflation data on Thursday, after the Fed’s hawkish dot plot shifted expectations toward a possible rate hike by October. Meanwhile, the U.S. granted Iran a 60-day license to sell oil, sending crude prices below $75 and boosting hopes for de-escalation. The yield on the 2-year Treasury hit its highest since February 2025. 14 15 16