U.S. stocks ended mostly higher on Monday, with the Nasdaq and semiconductor shares leading a partial recovery from Friday’s sharp selloff, as investors hunted for bargains amid lingering optimism around artificial intelligence and relief that direct confrontations between Iran and Israel had paused, at least temporarily.
The S&P 500 rose 21.99 points, or 0.30%, to close at 7,405.73. The Nasdaq Composite gained 220.23 points, or 0.86%, to 25,929.66, while the Dow Jones Industrial Average slipped 80.77 points, or 0.16%, to 50,786.01. Technology stocks were the clear outperformers, with the S&P 500 technology sector advancing 1.5% and the Philadelphia Semiconductor Index surging 5.6%, clawing back some of the roughly $1 trillion in market value erased from chipmakers on Friday.
The rebound came after a volatile session in which stocks gave up much of their early gains. Apple shares eased late in the day and finished 1.9% lower, even as the company unveiled significant AI upgrades to Siri at its Worldwide Developers Conference in Cupertino. Investors appeared to adopt a “sell-the-news” stance after months of anticipation around Apple’s AI progress.
Intel jumped 11.2% after The Information reported that Google’s parent Alphabet had placed an order for more than 3 million tensor processing units in 2028. Broadcom rose 2.8% following last week’s results, while Marvell Technology surged 9.6% ahead of its inclusion in the S&P 500 on June 22. Eli Lilly gained 1.6% after trial results showed its next-generation obesity drug, retatrutide, reduced sleep apnea severity in addition to promoting weight loss and easing knee pain.
Rick Meckler, partner at Cherry Lane Investments, described the session as classic bargain hunting.
“Today looks like a day where investors are doing a little bit of bargain hunting off the big tech selloff. What normally happens after that is you get analysts coming in and reiterating buys,” he said.
He added a note of caution about the broader environment: “This market has been priced for quite a while for perfection, and these are certainly imperfect times. In that environment, you are going to see some back-and-forth, and some fear of prices having gone too far.”
Geopolitical Relief Provides Tailwind Amid Mixed Sector Performance
Markets also drew some comfort from news that Iran and Israel had halted direct attacks on each other following an appeal from President Donald Trump to “stop shooting.” The exchanges over the previous 24 hours marked the most intense confrontation since the April ceasefire. While tensions remain high and uncertainty persists around the wider U.S.-Iran conflict and the Strait of Hormuz, the pause helped reduce immediate risk premiums.
Declining issues slightly outnumbered advancers by a 1.01-to-1 ratio on the New York Stock Exchange, while advancing issues led on the Nasdaq by a 1.28-to-1 ratio. The S&P 500 recorded 13 new 52-week highs and 7 new lows, while the Nasdaq posted 105 new highs and 164 new lows. Volume on U.S. exchanges totaled 19.50 billion shares, below the recent 20-day average of roughly 20.3 billion.
The session highlighted the market’s continued sensitivity to both AI enthusiasm and macroeconomic signals. Friday’s stronger-than-expected May jobs report had fueled concerns about persistent inflation and potential Federal Reserve rate hikes under new Chair Kevin Warsh, triggering the broad selloff. Monday’s partial recovery suggests investors are still willing to buy dips in high-quality tech names, particularly in semiconductors, despite the elevated valuations and external risks.
Bruce Zaro, managing director at Granite Wealth Management, offered a perspective on Apple’s reaction.
“Perception has been for quite some time that Apple had been behind the curve as far as their AI offerings. That’s why the stock widely underperformed many of the other big techs for some time until recently,” he said.
SpaceX’s upcoming IPO, expected to be one of the largest in history, is also looming as a potential test of market appetite for mega-cap tech listings. Any signs of overexuberance or hesitation could influence sentiment across the broader technology sector.
Overall, analysts see Monday’s trading as a reflection of a market still grappling with high expectations. While AI-related optimism continues to underpin gains in semiconductors and growth stocks, external factors, from geopolitical developments in the Middle East to domestic inflation concerns, are introducing meaningful volatility. The rebound in chips suggests investors remain constructive on the long-term AI thesis, but the session also served as a reminder that the path higher will likely include periodic pullbacks as reality checks emerge.
With the Fed’s next policy meeting approaching and ongoing uncertainty around energy prices and global growth, investors will continue to weigh the balance between technological promise and macroeconomic risks. However, the willingness to buy dips in leading names is seen as an indication that confidence in the AI-driven growth story remains intact for now, even if perfection is no longer being fully priced in.
