US stocks end mostly lower as chip rebound fizzles, oil retreat supports cyclical shares

US stocks ended mostly lower Tuesday as a rebound in semiconductor shares lost momentum, pulling down the S&P 500 and Nasdaq, while easing oil prices supported some cyclical sectors.

The S&P 500 fell 0.26%, or 19.08 points to end the day at 7,386.65, while the tech-heavy Nasdaq Composite lost 0.97%, or 250.84 points to 25,678.82.

The Dow Jones Industrial Average, on the other hand, rose 0.17%. points, or 86.10 points to close at 50,872.11.
The Volatility Index (VIX), often referred to as the market’s “fear index,” climbed 5.02% to 19.87.

Chip stocks resumed declines after Monday’s brief recovery. The iShares Semiconductor ETF dropped more than 1.6% after rebounding 6% in the previous session. The fund plunged 10% on Friday -- its worst day in six years.

Micron Technology fell nearly 1.4%, giving back part of Monday’s 10% recovery, while Broadcom lost more than 1.1% as investor concern about stretched AI-linked valuations continued to weigh on the sector.

Information technology was the weakest sector on the S&P 500, falling nearly 4%. Energy stocks also dropped around 2% as crude prices retreated.

West Texas Intermediate crude fell about 3.1% to $88.45 per barrel, while Brent crude declined to around $91, as investors weighed easing supply concerns against lingering geopolitical risks.

US President Donald Trump said earlier this week that negotiations were entering their final stage with Iran to end their war, and that a clearer outcome could emerge within days. He also said the US could declare “total victory” within two weeks.

At the same time, Trump said Iran had downed a US Apache helicopter near the Strait of Hormuz and that Washington would respond. US Central Command said two crew members were rescued after the helicopter went down off the coast of Oman, while the cause of the incident remained under investigation.

US Energy Secretary Chris Wright said ship traffic through the Strait of Hormuz was rising “very meaningfully,” reinforcing expectations that flows through the key energy route could continue to recover.

Lower oil prices helped support broader risk sentiment earlier in the session, with materials, consumer discretionary and real estate shares outperforming. Real estate stocks were also supported by stronger-than-expected housing data.

The National Association of Realtors said existing-home sales rose 3.2% in May to a seasonally adjusted annual rate of 4.17 million, beating expectations and reaching their highest since December.

Investors also continued to assess the outlook for the AI trade after OpenAI confidentially filed for an initial public offering ahead of SpaceX’s expected market debut later this week, which is being watched as a major test of investor appetite for high-valuation technology listings.

European markets

European stocks also saw losses, with the pan-European Stoxx Europe 600 index declining 0.5% to 618.64 points.

Germany’s DAX 40 lost 0.75% to end the session at 24,433.06, and the UK’s FTSE 100 was off 1.41% to 10,227.33. Losses in banking shares stood out in London.

France’s CAC 40, however, rose 0.05% to close at 8,203.43, and Italy’s FTSE MIB 30 gained 0.11% to finish at 50,262.76.