Stocks Fall as SpaceX’s Rout Offsets US-Iran Hopes: Markets Wrap
(Bloomberg) — Wall Street traders drove stocks down from the brink of record highs as a slide in several tech giants overshadowed optimism about progress in peace talks between the US and Iran. Oil retreated.
Equities turned lower as Alphabet Inc. led losses in megacaps. The Nasdaq Composite fell 1%. SpaceX sank 10% as Elon Musk’s company is selling investment-grade bonds for the first time, part of what’s expected to be a massive borrowing spree to fund AI ambitions. A rise in bond yields also weighed on sentiment. West Texas Intermediate hovered near $73 on hopes for a recovery in flows from the Persian Gulf.
Expectations for a lasting peace deal in the Middle East, the revival of the AI trade and solid corporate earnings have fueled an almost 20% surge in the US equity benchmark from war-driven lows.
While geopolitical developments are likely to remain a key source of volatility in the near term, shifts in investor confidence regarding the durability of the AI rally may also lead to bouts of market swings, according to Ulrike Hoffmann-Burchardi at UBS Chief Investment Office.
SpaceX’s bond sale is the latest in a wave of deals from companies driving the AI boom. Alphabet, Amazon.com Inc. and others have raised more than $300 billion of debt tied to AI since November across multiple credit markets. The rocket firm is seeking to raise at least $20 billion, Bloomberg reported.
“The issue that stands out the most is the idea that the hyperscalers continue to receive an extremely low return on investment on their colossal level of spending on AI,” said Matt Maley at Miller Tabak. “Another big concern surrounds the issue of ‘circular investments,’ where companies invest in each other, while also committing to buying each other’s products.”
Technology stocks will extend their rally for at least another couple of quarters as AI infrastructure spending accelerates beyond the pace of the past two years, Columbia Threadneedle Investments’ Tiffany Wade told Bloomberg Television.
On the geopolitical front, the US issued a 60-day license allowing Iran to sell oil on the international market, giving Tehran an economic lifeline as the two adversaries continued talks for a permanent peace deal. Vice President JD Vance described the first round of negotiations as “very very good” and said Iran had agreed to allow nuclear inspectors back into the country.
But Iranian officials, who also cited progress, challenged that claim, saying Vance’s assertion was “false and does not reflect reality.”
Elsewhere, Andy Burnham appears set to become the UK’s seventh prime minister in a decade after Keir Starmer laid out a timeline for his own departure and potential rivals backed a quick transition to the popular Manchester politician. While markets showed little reaction to the resignation, they were buoyed by reduced odds of a leadership contest that could have prolonged uncertainty.
Corporate Highlights:
SpaceX has inked a multibillion-dollar agreement to provide computing resources to artificial intelligence startup Reflection AI, the latest in a string deals from Elon Musk’s firm as it vies to become an AI infrastructure provider. Alphabet fell as Google DeepMind Vice President John Jumper — who won the 2024 Nobel Prize in chemistry for his work on AI — is leaving the company to join Anthropic PBC. Shares of stock-photo company Getty Images Holdings Inc. soared after it announced a licensing deal with OpenAI. Micron Technology Inc. climbed after announcing a strategic agreement with Anthropic to scale next-generation AI infrastructure. Chevron Corp. signed a 20-year deal with Microsoft Corp. to provide natural-gas fired power for a proposed West Texas data center, which could be one of the biggest in the US. What Bloomberg strategists say…
“While chip stocks have built enough insulation from gains in years past and robust earnings prospects, the idea of higher borrowing costs in the near future is likely to deter investors from automatically banking on more outsized rallies.”
—Kristine Aquino, Macro Strategist, Markets Live. For the full analysis, click here.
Some of the main moves in markets:
Stocks
The S&P 500 fell 0.3% as of 2 p.m. New York time The Nasdaq 100 fell 0.3% The Dow Jones Industrial Average rose 0.3% The MSCI World Index fell 0.1% Currencies
The Bloomberg Dollar Spot Index rose 0.2% The euro fell 0.4% to $1.1429 The British pound was little changed at $1.3244 The Japanese yen fell 0.1% to 161.52 per dollar Cryptocurrencies
Bitcoin rose 1.2% to $64,536.65 Ether rose 1.2% to $1,739.56 Bonds
The yield on 10-year Treasuries advanced six basis points to 4.51% Germany’s 10-year yield declined three basis points to 2.95% Britain’s 10-year yield declined three basis points to 4.81% Commodities
West Texas Intermediate crude fell 3.3% to $73.35 a barrel Spot gold rose 0.7% to $4,182.90 an ounce ©2026 Bloomberg L.P.
