New York equities fell across the board as ceasefire expectations faded after President Donald Trump ratcheted up military pressure on Iran. Memory chipmakers including Micron and SanDisk saw their shares plunge on the shock of Google's "TurboQuant" technology, which slashes memory usage in artificial intelligence models.
On the New York Stock Exchange on Monday (local time), the Dow Jones Industrial Average closed at 45,960.11, down 469.38 points (1.01%) from the previous session. The S&P 500 fell 114.71 points (1.74%) to 6,477.16, and the Nasdaq Composite dropped 521.74 points (2.38%) to 21,408.08.
Among large-cap technology stocks, Nvidia fell 4.16%, while Microsoft declined 1.37%, Amazon 1.97%, Alphabet (Google's parent) 3.44%, Broadcom 2.95%, Meta (Facebook's parent) 7.96%, and Tesla 3.59%, with the vast majority trading lower.
Investor sentiment froze as expectations for a U.S.-Iran ceasefire weakened within a single day. Trump wrote on his social network Truth Social, "They better get serious soon," warning that "once that point comes, there will be nothing that can be reversed and the situation will absolutely not unfold favorably." The remarks came roughly 48 hours before the deadline Trump had set after postponing strikes on Iran's energy infrastructure.
U.S. online outlet Axios reported the same day that the Pentagon was preparing military options for a "final strike" against Iran, potentially including ground troops. Israel also announced it had eliminated an Islamic Revolutionary Guard Corps (IRGC) naval commander who had directed the blockade of the Strait of Hormuz in actual operations.
Iran's semi-official Tasnim News Agency reported the country had sent an official response to the U.S. ceasefire proposal the previous day. A senior Iranian official told Reuters, "The U.S. proposal does not even meet the minimum requirements for success," adding, "There is still no readiness for negotiations, so a negotiation plan does not appear realistic at this stage."
The tech-heavy sell-off deepened after Google presented a potentially groundbreaking technology that could cut memory chip demand by up to six times. When news emerged that Google's new AI compression algorithm "TurboQuant" could enable AI models to process up to six times more capacity, shares of semiconductor companies supplying memory to data centers fell in unison. Micron and SanDisk tumbled 6.97% and 11.02%, respectively.
According to Google and other sources, TurboQuant uses an extreme compression technique that shrinks the size of AI models without sacrificing accuracy, reducing memory usage to one-sixth. AI models, including chatbots, require key contextual information such as previous conversations and search results to reason and generate responses. As conversations continue longer, the stored context data grows, and memory usage increases accordingly. Google and Meta also fell 7.96% and 3.43%, respectively, after a U.S. court jury the previous day ordered them to pay a combined $6 million (approximately 9 billion won) to plaintiffs in a lawsuit over teenage social media addiction.
International oil prices surged again as the Iran situation grew more unstable. On the New York Mercantile Exchange, West Texas Intermediate (WTI) crude futures for May delivery closed at $94.48 per barrel, up $4.16 (4.61%) from the previous session. Brent crude futures for May delivery rose 5.8% to $108.01 per barrel. Trump, presiding over a cabinet meeting the same day, commented on the recent trajectory of international oil prices, saying they "haven't risen as much as I thought they would."
As inflation concerns spread, Treasury yields also surged (with prices falling). The yield on the 10-year U.S. Treasury note rose 0.09 percentage points from the previous session to 4.42%.
