After opening firmly higher, stocks surrendered most of their early gains as another bout of weakness across semiconductor stocks offset broad strength fueled by a sharp decline in oil prices. The S&P 500 finished little changed, while the Nasdaq Composite slipped 0.2% and the DJIA gained 0.5%.

Semiconductor stocks remained under pressure throughout the session despite improved sentiment surrounding Asian technology stocks overnight. The information technology sector fell 1.0%, while the PHLX Semiconductor Index lost 2.2% as weakness across memory and AI infrastructure names continued. NVIDIA (NVDA 196.53, -10.31, -4.98%) finished as the worst-performing "Magnificent Seven" stock, reinforcing the group's outsized influence on the broader indices.

The weakness in semiconductors contrasted with strength elsewhere in technology. Apple (AAPL 336.91, +3.89, +1.17%) climbed to another all-time high, while software stocks significantly outperformed. The iShares Expanded Tech-Software Sector ETF (IGV) gained 3.3%, with many of the day's best-performing S&P 500 components coming from the software industry.

Broader market participation remained constructive despite the mixed finish for the major averages. The S&P 500 Equal Weight Index (+0.7%) outperformed its market-cap-weighted counterpart, while the Russell 2000 gained 0.7% and the S&P MidCap 400 added 0.3%. Seven of the 11 S&P 500 sectors finished higher, underscoring that today's weakness remained concentrated in a relatively small group of large-cap semiconductor stocks.

The communication services sector rose 1.5% as Alphabet (GOOG 326.57, +7.48, +2.34%) rebounded from last week's post-earnings selloff. The consumer staples (+1.6%) and financials (+1.0%) sectors also finished among the market leaders.

Tesla (TSLA 309.22, -3.81, -1.22%), however, remained under pressure following last week's earnings report, limiting gains in the consumer discretionary sector (+0.8%) despite a strong showing from its oil- and rate-sensitive components.

Energy was the weakest-performing sector, falling 2.0% as crude oil prices tumbled. Bloomberg reported that President Trump said there is a "good chance" of reaching a deal with Iran after previous reports that the U.S. has halted military strikes, helping send crude oil futures down $6.69 (-7.5%) to settle at $82.65 per barrel. Baker Hughes (BKR 60.59, +3.34, +5.83%), however, bucked the broader sector weakness following a better-than-expected earnings report.

Investors now turn their attention to one of the busiest weeks of earnings season, with several mega-cap technology companies set to report alongside key inflation data and Wednesday's FOMC policy decision. While semiconductors continue to drive much of the day-to-day movement in the major averages, today's session suggested that broader participation remains on firmer footing beneath the surface.

U.S. Treasuries began the week with a modest extension of their gains from Friday, though the market made little intraday progress past its higher start. Treasuries made it back to their opening levels as equities struggled to sustain their starting gains, holding steady after the U.S. Treasury sold $69 bln in 2-year notes to good demand. The market edged to fresh highs in the early afternoon but dipped back to starting levels with some pressure from a weak $70 bln 5-year note sale. The 2-year note yield settled down one basis point to 4.32% and the 10-year note yield settled down four basis points to 4.64%. 

• Russell 2000: +18.8% YTD
• S&P Mid Cap 400: +14.8% YTD
• DJIA: +8.6% YTD
• S&P 500: +8.3% YTD
• Nasdaq Composite: +7.3% YTD

Reviewing today's data:

• Durable goods orders rose 0.3% month-over-month in June (Briefing.com consensus 2.0%) after an upwardly revised 4.0% decrease (from -4.5%) in May. Excluding transportation, durable goods orders were up 0.6% month-over-month (Briefing.com consensus 0.9%) after increasing an upwardly revised 1.8% (from 1.3%) in May.
  
  • The key takeaway from the report is that the headline miss masked upward revisions to readings from May and concealed a 0.9% increase in new orders for nondefense capital goods excluding transportation, which is considered a proxy for business spending. On a year-over-year basis, these orders are up 9.3%.