Wall Street closes mixed as chip stocks tumble 3%, oil prices plunge 7%

Wall Street's three major indexes closed mixed Monday (local time), as a selloff concentrated in technology stocks deepened amid concerns over the profitability of AI investment and caution ahead of the US midterm elections.

The Dow Jones Industrial Average rose 213.67 points, or 0.41 percent, to close at 51,983.98 on the New York Stock Exchange.

The S&P 500 fell 38.67 points, or 0.51 percent, to 7,541.40, while the NASDAQ Composite dropped 272.68 points, or 1.07 percent, to 25,164.32.

The major indexes had climbed more than 1 percent early in the session, lifted by a sharp drop in oil prices, but gave back those gains as selling in technology stocks expanded.

The Philadelphia Semiconductor Index tumbled 3.37 percent. Micron fell 5.78 percent, AMD dropped 7.52 percent and Intel slid 8.80 percent.

Seo Sang-young, a managing director at Mirae Asset Securities, said the decline in chipmakers continued after Kioxia last week reported a slowdown in NAND price growth and issued an operating profit outlook that fell short of market expectations. Seo added that concerns over data center construction regulations, Anthropic's large-scale computing commitments and big tech's expanded fundraising had also fueled worries about the pace of future AI infrastructure investment growth.

Chipmaker Marvell's shares tumbled 12.72 percent and Lumentum's fell 18.59 percent after Marvell announced it would acquire Lumentum. The selloff reflected concerns that the large-scale acquisition would dilute shareholder value.

US economic data released that day came in above expectations. The Institute for Supply Management's manufacturing purchasing managers index for October came in at 55.5, topping the market consensus of 54.6. However, the prices index registered 75.2, signaling that inflationary pressure remains elevated.

Markets priced in a 73.2 percent probability that the Federal Reserve will raise its benchmark interest rate by 0.25 percentage point in December. The yield on the 10-year US government bond fell 3.4 basis points to 4.895 percent, while the 2-year yield edged up 0.2 basis points to 4.583 percent.

International oil prices tumbled more than 7 percent on hopes for US-Iran negotiations. President Donald Trump denied the possibility of resuming strikes on Iran, and Iran signaled its willingness to negotiate, easing fears of supply disruptions.

West Texas Intermediate crude settled at $96.46 per barrel, down 7.36 percent, while Brent crude fell 7.63 percent to $104.77 per barrel.