The major averages started this full week of trading that is sandwiched between two holiday-abbreviated weeks on a mostly lower note, with the S&P 500 (-0.4%) and Nasdaq Composite (-1.3%) pressured by weakness across mega-cap stocks while the DJIA (+0.3%) was supported by some rotational gains in the broader market.

Stocks opened mostly higher, supported by reports from both sides that negotiations between the U.S. and Iran are progressing measurably, while chipmaker stocks showed an extension of recent strength. However, losses across mega-cap stocks outside the semiconductor space quickly widened, pushing the major averages into mostly lower territory, where they traded in a relatively stable range for the remainder of the session.

Alphabet (GOOG 348.78, -18.68, -5.08%) was one of the worst-performing S&P 500 components, sinking below its 50-day moving average (365.20) after a top engineering executive, John Jumper, decided to leave Google DeepMind and join Anthropic. The headline added to lingering concerns over the company's massive AI capital expenditure plans, with the stock now down nearly 8% in June. Meta Platforms (META 563.85, -13.37, -2.32%) also traded lower while Netflix (NFLX 72.88, -4.50, -5.82%) fell to its lowest level since late 2024, and the communication services sector (-3.8%) ended the day as the worst-performing S&P 500 sector.

Amazon's (AMZN 232.79, -11.60, -4.75%)weakness ahead of tomorrow's Prime Day event weighed similarly on the consumer discretionary sector (-2.3%), and the Vanguard Mega Cap Growth ETF finished 1.4% lower.

SpaceX (SPCX 154.60, -30.40, -16.43%) retreated sharply for the third consecutive session, which contributed to the underperformance of the Nasdaq Composite.

Meanwhile, the top-weighted information technology sector had a flat showing today, with Microsoft (MSFT 367.34, -12.06, -3.18%) a "magnificent seven" laggard while NVIDIA (NVDA 208.66, -2.03, -0.96%) also traded lower despite the strength across semiconductor names.

Micron (MU 1211.38, +77.39, +6.82%) was a standout ahead of its earnings release Wednesday evening, while AI-infrastructure names such as Super Micro Computer (SMCI 35.46, +4.80, +15.66%) and Corning (GLW 209.85, +14.93, +7.66%) traded even higher.

Elsewhere, seven S&P 500 sectors traded higher, highlighting some rotational interest across the broader market. The real estate sector (+1.4%) captured the widest gain, while the energy sector (+1.2%) finished similarly despite crude oil retreating today after several sharp retreats last week.

The health care sector (+0.9%) was another outperformer, boosted by a strong showing from AbbVie (ABBV 230.06, +13.57, +6.27%) after the company agreed to acquire Apogee Therapeutics (APGE 132.55, +42.17, +46.66%) for $135.11 per share in cash.

Outside of the S&P 500, the Russell 2000 (+0.8%) and S&P Mid Cap 400 (+0.4%) outperformed, furthering the idea that not all of the money taken out of mega-cap tech today left the stock market entirely.

Overall, today's session was characterized by continued selling pressure across several mega-cap stocks, which obscured otherwise constructive underlying action. Strength across seven S&P 500 sectors and outperformance from both the Russell 2000 and S&P Mid Cap 400 suggest that investors remained engaged in equities, even as leadership continued to shift beneath the surface.

U.S. Treasuries began the week with losses across the curve after a lower start was followed by continued selling as the day went on. Treasuries recorded more than half of their losses at the open after the three-day holiday weekend featured some Friday selling in the futures market. The 2-year note yield settled up five basis points to 4.23%, and the 10-year note yield settled up six basis points to 4.51%.

There was no economic data of note today.

• Russell 2000: +21.1% YTD
• S&P Mid Cap 400: +15.2% YTD
• Nasdaq Composite: +12.6% YTD
• S&P 500: +9.2% YTD
• DJIA: +7.6% YTD