S&P 500, Nasdaq fall as megacap tech drags; Iran developments watched

The S&P 500 and the Nasdaq fell on Monday, dragged lower by declines in megacap technology names including Alphabet, while investors also assessed developments in U.S.-Iran negotiations. AI-driven optimism has supported Wall Street's recent rally, but analysts note that investors are increasingly questioning lofty spending by hyperscalers, who are raising funds to support infrastructure expansion. Alphabet tumbled 6.1 percent, while Meta, Amazon and Microsoft fell between 2.3 percent and 4.3 percent. "There's a distinguishing aspect in this market between those who are receiving the checks, like memory and DRAM names, and those who are writing the checks," said David Wagner, head of equity and portfolio manager at Aptus Capital Advisors. "Those who are writing the checks, i.e., the hyperscalers, have underperformed for the majority part of this year." The S&P 500 communication services index fell 4.4 percent, weighed down by declines in Alphabet and Meta. SpaceX declined almost 10 percent, extending losses for a third straight session after its stellar debut. The Elon Musk-led company laun