US equities mixed as oil surges on Middle East tensions and Nvidia chip news
Investors weigh conflicting signals from suspended US-Iran peace talks and strong manufacturing data, while tech gains from Computex Taipei offset geopolitical risk.
US equity markets closed mixed on Monday as investors navigated a complex landscape of geopolitical uncertainty and corporate developments. The Dow Jones Industrial Average fell 0.3 per cent, the S&P 500 remained flat, and the tech-heavy Nasdaq Composite rose 0.1 per cent. The modest gains in the Nasdaq were driven by announcements from the Computex Taipei conference, which helped offset weakness elsewhere in the market as it entered June following record highs in May.
Oil prices surged sharply amid reports that Iran had suspended peace talks with the United States. West Texas Intermediate crude rose 8 per cent to $94 a barrel, while Brent crude gained 7 per cent to $97. The escalation followed reports from Iran’s semi-official Tasnim news agency that Tehran had halted negotiations in protest of Israeli military actions in Lebanon and Gaza, demanding a cessation of hostilities before talks could resume. This development revived inflation concerns and reinforced expectations that the Federal Reserve may need to maintain a hawkish stance.
In the technology sector, Nvidia unveiled its new AI laptop chip, the RTX Spark, at the Computex Taipei conference. The announcement, which targets Windows laptops with over 128GB of memory expected to launch in the fall, boosted shares of partners Microsoft and HP while depressing competitors Intel and AMD. The tech sector’s strength provided a counterbalance to the broader market’s concerns over energy prices and Middle East stability.
Economic data released on Monday showed that US manufacturing activity expanded at its fastest pace in four years. The Institute for Supply Management reported that its gauge of manufacturing activity rose to 54 in May, beating economists’ predictions of 53 and April’s reading of 52.7. The index has now expanded for five consecutive months, bolstered by gains in production and new orders, much of which is driven by demand for artificial intelligence infrastructure.
Corporate activity also drew attention, with Anthropic filing confidential paperwork with the Securities and Exchange Commission to go public, beating rival OpenAI to the punch. Meanwhile, MGM stock jumped approximately 14 per cent after billionaire Barry Diller’s People Inc. submitted a cash offer of $48.30 per share to acquire the remaining 73.9 per cent of the company, valuing the deal at $18 billion including debt. Investors will now turn their attention to Friday’s nonfarm payrolls report for further clues on the labour market and interest rate expectations.
