A trader works on the floor of the American Stock Exchange (AMEX) at the New York Stock Exchange (NYSE) in New York, USA, on Wednesday, May 6, 2026.
Michael Nagle | Bloomberg | Getty Images
The S&P 500 fell to session lows on Monday after President Donald Trump announced he was reinstating what he called a blockade of Iranian shipping through the Strait of Hormuz.
The broad market index lost 0.3%, while the broad market index lost 0.3%. Nasdaq Composite decreased by 1%. Dow Jones Industrial Average traded up 164 points, or 0.3%.
“We are reinstating the IRANIAN BLOCKade, so named because it only prevents Iranian ships or customers from entering or leaving,” Trump said in a post on Truth Social. “From this point forward, the United States will be known as the “Guardian of the Strait of Hormuz,” but as such and in the interest of FAIRNESS, will be reimbursed at a rate of 20% of all cargo shipped for all costs necessary to carry out the work of providing security in this very volatile region of the world.”
Oil prices jumped after his announcement, with US West Texas Intermediate crude futures rising more than 5% to hit $75.
The latest escalation comes after Iran and the US exchanged airstrikes over the weekend. Tehran has struck US targets in several Gulf countries and declared the Strait of Hormuz closed, although Trump disputed that claim on Sunday, saying the key sea route remained open to commercial traffic.
Trump on Saturday ordered airstrikes against Iran after Tehran attacked a commercial ship transiting the strait.
Semiconductor manufacturers were under pressure. US listed stocks SK Hyniks fell 7% after the South Korean chipmaker debuted on the Nasdaq on Friday, when its shares soared 13%.
Shares in Micron Technology fell by 6%, and shares Sandisk drop 10%. Seagate technology fell by 6%. Elsewhere Advanced microdevices was 4% lower, and also Intel.
Major U.S. banks including JPMorgan Chase, Goldman Sachs, Morgan Stanley, Bank of America, Citigroup and Wells Fargo are among the 28 S&P 500 companies that will report earnings this week. Also presented are quarterly results from Netflix, Johnson & Johnson and UnitedHealth.
Expectations for the season are high. On average, analysts estimate S&P 500 earnings rose more than 23% year over year in the second quarter, according to FactSet.
One sector to watch is technology, according to Raymond James CIO Larry Adam. Specifically, whether AI can continue to drive revenue in this sector.
“Despite concerns that hyperscalers may begin to reduce AI-related capex, we expect capex plans to be confirmed and increase through 2028. Why? Because there is tangible evidence that businesses are benefiting from AI adoption. Mentions of AI across all 11 sectors are up 98% year-over-year, reaching new highs,” Adam wrote to clients.
The June CPI report is also due out Tuesday morning.