Dow rises while Nasdaq slides on oil surge, Treasury yields pressure tech

• Oil prices jumped sharply with WTI crude up 3% to $108.66 and Brent up 2% to $112.10 per barrel on Middle East tensions, though President Trump delayed a planned Iran strike citing ongoing negotiations
• Semiconductor stocks sold off heavily with Micron down 6%, Western Digital and Sandisk each down 5%, and Nvidia and Broadcom declining 1% as the 10-year Treasury yield hit its highest level since February 2025
• Rising energy costs and bond yields are fueling inflation concerns, with traders now pricing in a growing probability of another Fed rate increase by year-end; upcoming Nvidia and Walmart earnings reports are now in focus

Market Summary: Mixed U.S. Equities as Oil Surge and Yields Pressure Tech

Market Performance (May 18, 2026):

U.S. markets closed mixed Monday with the Dow Jones rising 159.95 points (+0.32%) to 49,686.12, while the S&P 500 declined 0.07% to 7,403.05 and the Nasdaq dropped 0.51% to 26,090.73. This marked the Nasdaq's second consecutive decline as investors reassessed valuations amid inflation concerns.

Key Sector Movements:

Technology and semiconductor stocks led market weakness. Seagate plummeted nearly 6%, while Micron dropped approximately 7% on AI demand capacity concerns. Western Digital and Sandisk each lost roughly 5%. AI chipmakers Nvidia and Broadcom declined around 1%. The selloff follows a record-setting rally earlier this month.

Energy and Geopolitical Tensions:

Oil prices surged significantly, with WTI crude up approximately 3% to $108.66 per barrel and Brent crude rising over 2% to $112.10 per barrel. The surge stemmed from Middle East tensions involving Iran and fears of Strait of Hormuz supply disruptions. President Trump announced delaying a planned military strike on Iran after regional negotiations, stating "serious negotiations are now taking place."

Bond Market Impact:

The U.S. 10-year Treasury yield reached its highest level since February 2025, contributing to technology sector pressure. Rising yields particularly impact high-growth, long-duration stocks, triggering a valuation reset in semiconductors.

Market Outlook:

Combined higher energy prices and elevated Treasury yields have intensified inflation concerns, reducing expectations for near-term Federal Reserve rate cuts. CME FedWatch data indicates growing probability of another Fed rate increase by year-end. Investor focus shifts to upcoming earnings from Nvidia and Walmart, which will provide insight into AI demand sustainability and consumer resilience amid rising fuel costs and inflation pressures.