U.S. equities opened the new trading week on a split footing on Monday as a sharp unwind in AI-infrastructure names dragged the Nasdaq 100 down by over 1%, while energy, communications and insurance shares cushioned the broader market.

President Donald Trump struck an uncompromising tone on Iran, posting that the conflict would end only when Tehran issued “Documents of Surrender” and “admit their defeat to the great power and force of the magnificent U.S.A.”

That stance directly contradicted leaks from Iranian state media, with Tasnim reporting Tehran is seeking a long, multi-stage truce and a long-term nuclear freeze rather than full dismantling, while a senior U.S. official told Axios the latest Iranian offer is “insufficient” and risks a resumption of hostilities.

That was enough to keep a firm bid under crude. WTI rallied 1.5% to around $106.96 a barrel, while Brent climbed 1.6% to $110.97 as traders flagged a temporary U.S. waiver on Iranian oil sanctions reported by Tasnim alongside a separate Treasury extension of the Russian seaborne oil sanctions waiver for another 30 days.

Across U.S. equity markets by midday Monday, losses were narrow but tilted toward growth.

The Nasdaq 100 fell by 1.1%, eyeing its worst two-day slump since late March. NVIDIA Corp. (NVDA) shed 2.04% ahead of Wednesday’s earnings.

The S&P 500 fell 0.4% to 7,381, the Dow Jones Industrial Average held nearly flat at 49,488 and the small-cap Russell 2000 slipped 0.7% to 2,773.

Persistently elevated oil prices kept upward pressure on yields. The 10-year Treasury yield hovered around 4.60% near 16-month highs, with the two-year at 4.08% and the long-end 30-year at 5.13%.

Fed funds futures now imply roughly a 60% probability of an additional 25 basis-point rate hike before year-end, even as incoming Fed Chair Kevin Warsh had signaled a preference for easier policy.

Monday’s Performance In Major U.S. Indices

According to market data:

• The Vanguard S&P 500 ETF (VOO) slid 0.4%.
• The SPDR Dow Jones Industrial Average ETF Trust (DIA) dipped 0.1%.
• The Invesco QQQ Trust (QQQ) fell 1.1%.
• The iShares Russell 2000 ETF (IWM) dropped 0.7%.

AI Capex Unwind Hammers Semis and Data Center Stocks As Energy and Defensives Lead

The Technology Select Sector SPDR Fund (XLK) was the worst-performing S&P 500 sector, dropping 1.5% as the AI-infrastructure trade unraveled across semis, memory and power-equipment names. The VanEck Semiconductor ETF (SMH) tracked the move lower, while the Industrial Select Sector SPDR Fund (XLI) shed 0.7% as data center build-out plays were repriced.

The AI-hardware sell-off was concentrated in capex-sensitive names. Applied Materials Inc. (AMAT) dropped 5.3%, Micron Technology Inc. (MU) fell 4.2%, Oracle Corp. (ORCL) slid 3.8%, and GE Vernova Inc. (GEV) shed 5.0%.

Clean-energy stocks also sold off. The Invesco WilderHill Clean Energy ETF (PBW) tumbled 5.4%, the day’s worst industry move, pressured by rising Treasury yields and profit-taking behavior after recent rallies.

Leading the charge higher was the Energy Select Sector SPDR Fund (XLE), up 1.8% with WTI back above $106 a barrel. Exxon Mobil Corp. (XOM) added 1.5% and Chevron Corp. (CVX) rallied 2.1%.

The SPDR S&P Insurance ETF (KIE) was the standout industry gainer, up 2.3%, and the iShares U.S. Home Construction ETF (ITB) jumped 1.6% after the May NAHB Housing Market Index printed 37 versus the 34 consensus, signaling improving builder sentiment.

Monday’s Russell 1000 Top Gainers

The session’s defining corporate story was a $66.8 billion utility mega-merger.

Dominion Energy Inc. (D) surged 9.3% after NextEra Energy Inc. (NEE) agreed to acquire it in an all-stock deal at a 0.8138 exchange ratio, with Dominion also reporting first-quarter operating EPS of 95 cents versus 91 cents consensus and reaffirming 2026 guidance of $3.45-$3.69. NextEra fell 5.8% on dilution and integration concerns.

Bio-Rad Laboratories Inc. (BIO) jumped 11.7% after the Wall Street Journal reported Elliott Investment Management built a sizeable stake in the life-sciences group.

Cybersecurity and enterprise software also caught a bid. ServiceNow Inc. (NOW) jumped 7.2% after Bank of America reinstated coverage with a Buy rating.

Zscaler Inc. (ZS) climbed 7.6% on positive cybersecurity sector read-through from Fortinet’s blowout print, with BofA also reinitiating Buy ahead of Zscaler’s late-May earnings.

Roblox Corp. (RBLX) rebounded 10.2% to around $47.22 in a sharp short-covering bounce.

Monday’s Russell 1000 Top Losers

On the downside, the day’s biggest casualty was Regeneron Pharmaceuticals Inc. (REGN), down 10.19% after the company’s Phase 3 fianlimab/cemiplimab combination failed to reach statistical significance on progression-free survival versus Merck’s Keytruda in first-line metastatic melanoma.

Citi cut the stock to Neutral from Buy and slashed its price target from $900 to $700, effectively wiping out the melanoma opportunity from the LAG-3 program’s valuation.

Rare-earth and battery names extended their slide. MP Materials Corp. (MP) dropped 9.7%.

Vertiv Holdings Co (VRT) tumbled 8.9% with no fresh company-specific catalyst on the tape, with the move tracking broad profit-taking after the data-center power-management leader hit an all-time high on May 14. Lumentum Holdings Inc. (LITE) slid 9.1% in its debut session as a Nasdaq-100 constituent.

QuantumScape Corp. (QS) fell 8.4%, also on no fresh news beyond ongoing investor concern about the company’s $250 million-$275 million 2026 adjusted EBITDA loss guidance and roughly $69.5 million quarterly cash burn.

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