Crude oil prices sank and interest rates were lower Monday on renewed hope for peace in the Middle East. But semiconductor stocks sold off as markets continue to wonder when escalating hyperscaler capex budgets will generate returns on investment.

The front-month West Texas Intermediate crude oil futures contract was down 8.1% to $82.04 per barrel. The 2-year Treasury yield declined by nine basis points to 4.322%.

Both are still much higher than they were before the war between the U.S. and Iran started on February 28. But the immediate reaction to the suspension of attacks in the U.S.-Iran war "implies further equity upside when the conflict is fully over," according to Louis Navellier of Navellier & Associates.

"The Fed decision on making a change in the fed funds rate will be the big event of the week," Navellier observes about the economic calendar.

The July Fed meeting starts tomorrow and ends Wednesday. Price action in the fed funds futures market shows a 64% probability the central bank keeps its primary benchmark where it is this week. But, according to CME FedWatch, odds of a rate hike in September are now up to 55.5%.

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It's also a big week for the earnings calendar, as Navellier notes: "By the end of the week, more than a third of S&P companies will have reported."

At the closing bell, the Dow Jones Industrial Average was up 0.5% to 52,209, and the broad-based S&P 500 had inched up 0.02% to 7,413 But the tech-heavy Nasdaq Composite was down 0.2% to 24,932.

AAPL > NVDA

Nvidia (NVDA, -5.0%) was the worst-performing Dow Jones stock during a rough session for chipmakers. The iShares Semiconductor ETF (SOXX, -2.1%) reflected broadening concern about the sustainability of the AI revolution as its leader makes new and bigger deals.

Bloomberg reported that Nvidia is discussing one deal worth as much as $250 billion to help its customer OpenAI lease computing power from a U.S. data center and another to finance $350 billion of OpenAI's chip purchases for the project.

On Friday, Nvidia announced a $500 billion deal with South Korea-based chipmaker SK Hynix (SKHY, -7.5%) that illustrates what skeptics describe as "circular" AI deals supporting the infrastructure build-out.

Apple (AAPL, +1.2%), meanwhile, overtook NVDA to become the biggest company in the world in terms of market cap. The iPhone maker will carry a year-to-date return of about 23% into its fiscal third-quarter earnings announcement after the closing bell on Thursday.

Meanwhile, amid rising anxiety about their capex plans, Meta Platforms (META, -0.2%) and Microsoft (MSFT, +1.9%) will report after the closing bell on Wednesday. Amazon (AMZN, -0.3%) joins AAPL in the spotlight on Thursday.

As Navellier writes, these four Magnificent 7 stocks account for 17% of the weight of the S&P 500 "and will be very telling of the continued confidence in the AI theme." Nvidia will report fiscal 2027 second-quarter earnings on Wednesday, August 26.

QBTS + T

D-Wave Quantum (QBTS, +8.9%) is one of the best ways to invest in quantum computing right now because it's making deals with classic blue-chip companies such as AT&T (T, +1.2%).

On Monday, D-Wave Quantum announced the expansion of a partnership teased in January when AT&T executives appeared at the Qubits 2026 conference. The telecommunications giant will now use D-Wave's tech across its network operations, most notably outage detection and traffic management.

"AT&T's initial focus is on layering D-Wave's annealing quantum computing technology into the tools that are already powering AT&T's agentic AI solutions," D-Wave said in its press release.

Mizuho Securities analyst Vijay Rakesh reiterated his Outperform (Buy) rating and raised his 12-month target price for QBTS from $29 to $35 following management's first "analyst day" event in June, citing its leadership in annealing QC.

Rakesh says D-Wave's updated financial model shows long-term gross margins for quantum computing as a service (QCaaS) at 65% to 75%, professional services at 40% to 50% and computing systems at 75% to 90%.

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