Dow Jones, S&P 500, NASDAQ end lower as chip stocks slump; Alphabet falls over 4%

The Dow Jones Industrial Average fell 0.20% to 52,552.97, while the S&P 500 index descended 0.51% to 7,533.77.

Chip stocks turned red after Taiwan Semiconductor Manufacturing Company (TSMC) posted better than expected earnings but raised its capital expenditure outlook. The company increased its 2026 capital expenditure budget to $60 billion-$64 billion from an earlier estimate of $52 billion-$56 billion.

In US dollars, TSMC's second quarter revenue was $40.20 billion, which rose 33.7% year-over-year (YoY) and increased 12.0% from the previous quarter.

"Our business in the second quarter was supported by strong demand for our leading-edge process technologies," said Wendell Huang, Senior VP and Chief Financial Officer of TSMC. "Moving into third quarter 2026, we expect our business to be supported by continued strong demand for our leading-edge process technologies, including the steep ramp-up of our 2-nanometer technology."

The VanEck Semiconductor ETF slid 3.7% due to a 5.41% drop in Arms Holdings. Shares of Advanced Micro Devices and Micro Technology also declined over 5% each.

Nvidia, Alphabet and Amazon.com were down 2.4%, 4.43% and 1.99%, respectively. Shares of SpaceX plummeted 3.08% to $131.11, dropping below its IPO price of $135. The stock of recently listed SK Hynix slid over 13%.

Meanwhile, Brent Crude, the international standard, increased 0.92% to $85.02 per barrel as the United States launched new waves of strikes against Iran for a sixth consecutive night in a row.

"U.S. forces, including fighter jets, aerial drones, and warships, launched precision munitions that hit dozens of Iranian military targets such as coastal surveillance and air defence sites, military logistics infrastructure, and maritime capabilities. This was the sixth consecutive night of U.S. strikes against Iran," the US Central Command said.