Broader Indexes Slides as Global Chipmakers Face Growing Skepticism

Barry Adams
13 Jul, 2026
New York City

Stocks on Wall Street traded down on Monday amid growing uncertainty in the Middle East and lingering concern about the stretched valuations of the AI-related stocks. 

The S&P 500 Index decreased 0.3%, and the tech-heavy Nasdaq Composite declined 0.9% following another day of sell-off in memory stocks. 

SK Hynix dropped as much as 9% in early trading following South Korean chipmakers' U.S. debut on Friday, when it soared 13%.  

Investors are increasingly questioning the recent run in stock prices of AI-linked stocks and whether the demand boom for memory modules justifies the current rally. 

While AI spending by hyperscalers remains enormous, questions on the scale of investment, lagging returns, and financing costs have begun to weigh on the entire sector. 

Memory makers are certainly hoping that the latest business cycle is likely to extend several more years by locking customers into longer-term contracts. 

However, the circular financing is likely to weigh on chipmakers' earnings in 2027 and beyond, and investors are wondering if all of the future growth is already reflected in current valuations. 

Crude oil prices increased 3.5% to $73.65 a barrel as the U.S. and Iran exchanged fire over the Strait of Hormuz. The sharp escalation in fighting over the weekend supported the worry that energy-product supply disruption is likely to last longer than previously estimated. 

Later in the week, investors are awaiting the release of earnings from major banks and brokerage houses—including JPMorgan Chase, Citigroup, Bank of America, Wells Fargo, Morgan Stanley, and Goldman Sachs. 

Johnson & Johnson, Netflix, and UnitedHealth are scheduled to release their quarterly updates. 

About 27 S&P 500 companies are scheduled to release their quarterly results later this week. 

On the economic front this week, investors are awaiting the release of inflation and consumer sentiment and comments from Fed Chair Kevin Warsh.