US stocks declined on Monday as escalating tensions between the United States and Iran prompted investors to adopt a cautious stance. The S&P 500 fell 0.4% at its session low, while the NASDAQ Composite dropped 1%. The Dow Jones Industrial Average traded roughly 56 points lower, or 0.1%.
The market weakened after President Donald Trump announced the reinstatement of a blockade targeting Iranian shipping through the Strait of Hormuz. Oil prices surged on the news, adding pressure to growth stocks and other risk assets. This came despite the S&P 500 posting two consecutive weekly gains amid volatile chip shares and renewed Middle East risks.
Oil Surges After New Hormuz Order
Trump stated that the United States would act as ‘THE GUARDIAN OF THE HORMUZ STRAIT’ and impose a 20% charge on cargo shipped through the route to cover security costs. He said the action would prevent Iranian ships and customers from entering or leaving via the waterway.
West Texas Intermediate crude futures gained more than 5%, moving above $75 per barrel. Brent crude climbed about 5.3% to $80. The gains followed another exchange of strikes between the US and Iran over the weekend, renewing concerns over energy supplies and shipping access.
Chip Stocks Lead the Market Decline
Semiconductor shares posted some of Wall Street’s steepest losses. US-listed shares of SK Hynix fell 7% after surging 13% during its NASDAQ debut on Friday. Micron Technology dropped about 6% to 7%, while Sandisk lost close to 10%. Seagate Technology fell 6%, and Advanced Micro Devices and Intel traded around 4% lower. The Philadelphia Semiconductor Index slid 3.6%, standing more than 14% below its late-June record.
Technology became the weakest S&P 500 sector during the morning session, falling about 1.3%. Four of the index’s 11 sectors traded lower early. The NASDAQ posted the largest decline among the three major indexes, while gains in IBM and UnitedHealth helped limit losses in the Dow.
“Markets have started the week firmly on the defensive,” said Daniela Hathorn, senior market analyst at Capital.com. She linked the weaker mood to renewed US-Iran tension and uncertainty over the path toward a lasting agreement.
Earnings and CPI Move into Focus
Wall Street also prepared for a busy week of corporate results. JPMorgan Chase, Goldman Sachs, Morgan Stanley, Bank of America, Citigroup, and Wells Fargo will report. Netflix, Johnson & Johnson, and UnitedHealth also have results scheduled.
Analysts expect second-quarter S&P 500 earnings to rise by more than 23% from a year earlier, based on FactSet and LSEG estimates. Investors will track bank results for signs of consumer strength and credit quality. Technology earnings will also draw attention as companies update AI spending plans.
The June consumer price index report arrives Tuesday morning. The data could reshape interest-rate expectations after higher oil prices renewed inflation concerns. Federal Reserve Chair Kevin Warsh will also deliver his first monetary policy testimony before Congress on Tuesday.
Apple drew attention after Citi raised its price target to $365 from $315, citing potential market share gains despite slower demand. Analyst Asiya Merchant noted that ‘selective price increases’ may offset margin pressure, and pointed to the September iPhone 18 launch as a possible catalyst before Apple reports earnings on July 30.
