Markets News, July 27, 2026: Nasdaq Slips as Chip Stocks Drop, Dow Rises, Oil Prices Plunge

The Dow Jones Industrial Average closed higher on Monday, July 27, 2026, while the Nasdaq Composite slipped and the S&P 500 finished essentially flat. Oil prices plunged after two weekend reports pointed to a pause in hostilities between the U.S. and Iran. One report said Iran would pause military attacks if the U.S. kept its own pause in place. The other said President Donald Trump had called off an escalation of the conflict. U.S. benchmark West Texas Intermediate (WTI) crude futures sank 7.8% to $82.30 a barrel, and global benchmark Brent crude dropped 9.1% to $88 as of 4 p.m. ET. Cheaper crude pulled energy stocks lower. A reversal in semiconductor and memory shares weighed on the tech-heavy Nasdaq, and a rally in software stocks and Apple offset part of that decline. Apple closed at a record high and overtook Nvidia as the world’s most valuable public company. The session opened the busiest week of the second-quarter earnings season and came ahead of a Federal Reserve meeting at which traders were pricing higher odds of a rate hike.

Oil Prices Plunge on Signs of a Pause in US-Iran Hostilities

Crude’s decline on Monday followed the weekend reports on Iran. Oil had climbed during the conflict, and pump prices had followed. Gasoline had moved back above $4 a gallon, which fed inflation worries in bond markets the previous week. The two reports suggested both sides were stepping back, and traders removed some of the risk premium that had built up in crude futures.

WTI fell 7.8% to $82.30 a barrel. Brent dropped 9.1% to $88, a larger percentage decline than the U.S. grade, though Brent still finished the session above WTI. Both figures were as of 4 p.m. ET.

The reports described a pause in hostilities and did not describe a settlement. That leaves crude exposed to further developments in the US-Iran conflict, and with it energy stocks, gasoline prices and the inflation outlook.

The decline in crude also bears on the inflation picture. Oil feeds into gasoline, diesel, jet fuel and petrochemical prices, and from there into consumer inflation readings. Higher gasoline prices had helped push Treasury yields up the previous week. Some Federal Reserve officials have argued that energy shocks tied to the Iran war may prove less persistent as a source of inflation than spending on AI infrastructure. That debate carries into the Fed’s meeting on Tuesday and Wednesday.

Energy Stocks Lead the S&P 500 Lower

The drop in crude hit producers’ shares directly. Chevron (CVX) fell roughly 2.5% and ExxonMobil (XOM) about 1.5%.

Nearly two hours into the session, the S&P 500 Energy sector was the worst performer among the index’s 11 sectors, down 1.6% at that point. Targa Resources (TRGP), a midstream company that gathers and processes natural gas and natural gas liquids, led energy decliners in the early going with a drop of nearly 4.5%.

Energy was one of two sectors at the bottom of the board in the morning. Information Technology was down 1.1% at the same point, second only to energy among the session’s laggards, as chip and memory stocks turned lower.

Futures Pointed Higher Before the Open

The Iran reports broke over the weekend, and stock index futures were the first market to react. Futures tied to the Dow pointed up 1.1% ahead of the opening bell.

The premarket gains did not carry through evenly. The Dow held a gain into the close. The S&P 500 gave back most of its early strength and ended essentially flat. The Nasdaq slipped into negative territory as semiconductor shares reversed.

How the Major Indexes Split

The three major indexes went separate ways as the peak week of earnings season began. All three were coming off two consecutive weekly declines. The July 17 session, when the S&P 500, Dow and Nasdaq all closed lower and posted weekly losses, was part of that stretch.

Nvidia (NVDA) fell 5%, the worst performance among the Dow’s 30 components. The Dow still rose because enough of its other members gained. In the Nasdaq and the S&P 500, Nvidia’s drop and declines across the memory and chip group offset strength in software and in Apple. A slight majority of the Magnificent Seven finished lower.

The small-cap Russell 2000, which has little exposure to the megacap AI trade, also closed higher.

Chip and Memory Stocks Reverse Early Gains

Semiconductor shares opened higher and then sold off. The Roundhill Memory ETF (DRAM) and the broader iShares Semiconductor ETF (SOXX) were each down more than 4% by late morning after giving up their early gains. Both recovered part of that loss by the bell. DRAM closed down about 1.5% and SOXX about 2%.

Memory and storage names fell hardest. Sandisk (SNDK), Western Digital (WDC) and Seagate Technology (STX) dropped between 4% and 11%. Sandisk was down 11% at one point, the worst performer in the Information Technology sector and in the entire S&P 500 at that moment.

The group has had a large run this year. Seagate’s shares have tripled since the start of the year on demand for hard drives and storage tied to AI data centers. They have also slipped roughly 30% from their highs last month as part of a wider pullback in the AI trade. The July 16 session, when the Nasdaq fell on concerns about AI spending, was one of the days that set that tone.

Monday’s selling in chips coincided with a report on Nvidia and OpenAI that revived questions about how the AI buildout is being financed.

Nvidia and OpenAI’s Reported $250 Billion Ohio Deal

Nvidia’s decline followed a Wall Street Journal report that the chipmaker is in talks with OpenAI to guarantee up to $250 billion in financing. The money would allow OpenAI to lease space at a federal government-backed data center site in Ohio.

According to the report, the site is being developed in partnership with the Japanese government and SoftBank, a major OpenAI investor, as part of a tariff-related trade deal. Nvidia’s guarantee could help OpenAI secure the funding it needs to lease the facility.

The talks are the latest example of what investors call circular financing in the AI industry, in which chipmakers and their customers support each other financially. Critics argue the structure can inflate reported demand, because some of the purchasing power comes from the seller itself. It also ties the chipmaker’s risk to the customer’s ability to pay. These deals have become a focal point for investors worried about an AI bubble.

Under a guarantee, Nvidia would not necessarily spend $250 billion. It would be on the hook if OpenAI could not meet its lease obligations. The size of that potential exposure appeared to weigh on the stock, which closed down 5%. At one point in the session, Nvidia was down nearly 5.5%, for a market capitalization of about $4.74 trillion.

Apple Retakes the Largest Market Cap From Nvidia

Apple (AAPL) closed at a record high and overtook Nvidia as the world’s most valuable public company by market capitalization. During the session Apple’s shares hit an all-time high of $339.57. Later they were up nearly 1% at above $336, for an intraday market cap of about $4.94 trillion, compared with Nvidia’s roughly $4.74 trillion at the same point.

Apple had briefly passed Nvidia intraday on July 17, but Nvidia retook the lead by the closing bell that day. Monday’s change held through the close. The last time Apple held the top spot at the end of a session was May 2, 2025.

Apple’s record came days before its quarterly results, which are scheduled for Thursday. Amazon also reports Thursday, and Meta Platforms and Microsoft report Wednesday, so all four megacaps will release results within two days.

Software Stocks Move the Other Way

Software shares rallied while chipmakers fell, a sharp rotation within the technology sector. The iShares Expanded Tech-Software Sector ETF (IGV) was up about 4% in late-morning trading. Salesforce (CRM) led with a gain of roughly 6.5% at that point. ServiceNow (NOW), Palantir (PLTR), Oracle (ORCL) and Microsoft (MSFT) were each up about 3% to 6% in late-morning trading. Those figures are intraday readings. Closing figures for the group were not reported.

No single catalyst for the bounce was identified. Software stocks spent much of 2026 under pressure from worries that AI tools could disrupt traditional software business models. Microsoft entered the week down nearly 20% for the year, hurt by those concerns and by scrutiny of its own AI capital spending. Monday’s session showed money rotating out of AI hardware names and into the software group.

Quantum Computing Stocks Jump on D-Wave’s AT&T Deal

D-Wave Quantum (QBTS) signed an agreement with AT&T to help the telecom carrier optimize its network operations, and the news lifted the quantum computing group. In the final hour of trading, D-Wave was up 18%, Rigetti Computing (RGTI) 9% and IonQ (IONQ) 7%.

Under the deal, AT&T will expand its use of D-Wave’s quantum computing technology to tackle complex optimization problems across its network. AT&T said D-Wave’s technology had already cut the processing time for one network optimization workload from about an hour to under 15 seconds.

AT&T plans to apply the technology more broadly, including to outage detection and response, technician routing, network build planning and traffic management. D-Wave’s approach, quantum annealing, is designed for optimization problems of that kind, which involve searching very large numbers of possible combinations.

The agreement gives the sector a commercial deal with a large telecom carrier. Even after Monday’s gains, D-Wave, Rigetti and IonQ remain down between roughly 20% and 30% for the year.

Forte Biosciences Agrees to $2.2 Billion Argenx Buyout

Forte Biosciences (FBRX) agreed to be acquired by Dutch biotech Argenx (ARGX) for $77 per share in cash, a deal valued at about $2.2 billion. Shares of the Dallas-based company jumped 40% to more than $76 in premarket trading, just below the offer price.

The deal capped a rapid run for the stock. Before July 9, Forte traded below $21 and was slightly negative for the year. That day it reported positive Phase 1b data for its vitiligo treatment, and the stock surged. It closed Friday at $54.78, up 166% for 2026. The acquisition came less than three weeks after the trial results.

Forte’s lead program, FB102, is the asset Argenx is paying for. Argenx describes it as a first-in-class anti-CD122 antibody with clinical proof of concept in vitiligo and celiac disease, and potential in other autoimmune conditions.

Argenx CEO Karen Massey said the purchase builds on the company’s Vision 2030 strategy and supports its ambition to lead in immunology. The transaction is expected to close in the third quarter. Argenx’s U.S.-listed shares, up 9% for the year entering Monday, slipped 1% before the bell.

MapLight Therapeutics Plunges After Trial Miss

MapLight Therapeutics (MPLT) lost more than two-thirds of its market value, plunging 69% after a mid-stage trial failure.

The company’s Phase 2 ZEPHYR trial tested ML-007C-MA as a once-daily treatment for schizophrenia. The once-daily dosage did not achieve statistical significance on the trial’s primary endpoint, the main outcome the study was designed to measure.

MapLight describes itself as a clinical-stage biopharmaceutical company focused on central nervous system disorders. It said it is running further analyses to guide a potential path forward for a once-daily regimen. After Monday’s drop, the stock is down roughly 35% for the year.

Cracker Barrel Names a New CEO

Cracker Barrel Old Country Store (CBRL) said before the open that chief executive Julie Masino will step down as CEO and leave the board on Aug. 10. Former Bloomin’ Brands CEO David Deno will replace her. Masino will stay on in an advisory role until Oct. 9 to support the transition.

The change comes about a year after the restaurant chain’s logo controversy. Last August, Cracker Barrel briefly replaced its long-standing logo, an older man leaning on a barrel, with a version showing only the company name, in an effort to appeal to younger customers. The public reaction was strongly negative, and President Trump said the company should go back to the old logo. The stock fell sharply, and Cracker Barrel restored the original design.

The shares remain down roughly 20% since then. They fell 2% in early trading Monday.

Options Price Big Earnings Moves for Seagate and Microsoft

Options traders were positioned for large post-earnings swings in two of the week’s reporters. Seagate reports after the close Tuesday, and Microsoft reports after the close Wednesday.

Seagate

For Seagate, recent options pricing implied a swing of as much as 12% in either direction by the end of the week. Measured from the stock’s midday level Monday, the upper end of that range would put shares back above $900, where they traded earlier in July. The lower end would take them to around $720.

Morgan Stanley analysts said in a client note Monday that they expect Seagate and Western Digital to beat Wall Street estimates and raise their outlooks. They cited strong hardware demand and higher prices. Western Digital reports on Aug. 5.

Microsoft

For Microsoft, options implied a move of up to 6% in either direction by Friday. From Monday’s level near $392, that range runs from about $368 on the downside to about $417 on the upside. A move to the upper end would put the stock at its highest point in over a month.

Deutsche Bank analysts said investors will likely focus on rising hardware prices, the company’s AI investments and how concentrated its backlog has become.

Treasury Yields and Fed Rate-Hike Odds

The 10-year Treasury yield eased by roughly four basis points from Friday’s close. On Thursday it had climbed to nearly 4.72%, its highest level since January 2025, as rising gasoline prices revived inflation fears. Monday’s drop in oil helped pull it back. The 10-year yield influences rates on many consumer loans, including mortgages.

Rate expectations moved the other way. According to the CME Group’s FedWatch tool, traders priced a 38% chance of a rate hike at this week’s Federal Reserve meeting, up from about 16% a week earlier. They also priced an 82% chance of at least a quarter-point hike by the September meeting, up from 64% a week before.

Those figures are market-implied odds derived from fed funds futures prices, and they can swing quickly on new inflation data. Fed watchers broadly expected policymakers to hold rates steady this week, with hikes possible later in the year. For the longer record of price pressures behind that debate, see our U.S. inflation rate by year data.

Chris Larkin, managing director of trading and investing at E*TRADE from Morgan Stanley, said in written commentary that the week held an unusual number of potential surprises in both directions. He described geopolitics and oil as the biggest wild cards. He cautioned that strong Magnificent Seven earnings would not guarantee a rally if AI spending levels kept unsettling investors. With the possibility of a hike higher than it had been in a while, he said, choppy trading could continue even if markets ultimately moved higher.

Bitcoin, Gold and the Dollar

Moves outside equities and oil were modest. Bitcoin traded around $64,900 late in the session, up slightly over 24 hours. The U.S. dollar index was near flat at 101.50. Gold futures rose 0.4% to $4,090 an ounce. These were late-session readings.

Household Wealth’s Record Tilt Toward Stocks

American households have more of their wealth tied to the stock market than at almost any point on record, as fears of an AI bubble unsettle equities. Federal Reserve data show stocks make up 32% of everything U.S. households own. That share is about the highest in the Fed’s quarterly records, which go back to the early 1950s, and well above the 27% peak of the dot-com era.

Goldman Sachs told clients last week that households in the U.S., Australia and Sweden hold more of their financial assets in stocks than households anywhere else. European and Japanese households still hold more cash. Americans are the most exposed.

The shift has been mostly passive. Stocks rose faster than everything else households own, and equities now outweigh what Americans hold in their homes. Goldman said equity gains have been the main driver of household wealth accumulation. It also said the wealth effect, the tendency to spend more when portfolios rise, has supported consumer spending this year. A sharp market decline would hit household balance sheets harder than in past cycles, with possible knock-on effects for spending, according to the firm.

What Comes Next This Week

About a third of S&P 500 companies report quarterly results this week, the peak of earnings season.

Megacap Earnings

Meta Platforms (META) and Microsoft report Wednesday. Amazon (AMZN) and Apple report Thursday. Seagate reports after the close Tuesday.

AI spending is expected to draw as much attention as the headline results. Last week Alphabet comfortably beat expectations, but its stock fell after the company raised its projected spending on AI infrastructure. That reaction was part of the selling behind the major indexes’ consecutive weekly losses. Tech companies are issuing stock and borrowing to fund the construction and operation of AI data centers, and investors are looking for evidence that the spending will pay off.

Monetization is the other focus. Meta is reportedly exploring a cloud computing business that could sell excess compute capacity or access to its AI models. Amazon is charging customers more to rent the hardware needed to train and run AI models. Investors will look for those efforts in revenue and guidance.

The Fed and Economic Data

The Federal Open Market Committee meets Tuesday and Wednesday. A change in rates is not expected, but the post-meeting statement and press conference may signal whether hikes are coming. Policymakers are likely to discuss AI-driven investment alongside energy prices as inflation factors.

On Thursday, the government releases the personal consumption expenditures (PCE) price index, the Fed’s preferred inflation gauge, along with gross domestic product data. With rate-hike odds already rising, a hot PCE reading could push them higher. A cooler reading, combined with Monday’s oil decline, could ease them.

Oil and Iran

Oil remains the main variable outside the economic calendar. Monday’s drop rested on reports of a pause in hostilities between the U.S. and Iran, and any change in that conflict would feed through to crude, energy stocks, gasoline prices and the inflation readings the Fed is watching.