Big Tech Plummets on Wall Street: Is Oil or Interest Rates the Real Variable?

On the 22nd (local time; early morning on the 23rd in Korea), New York markets closed mixed. The S&P 500 fell 0.4% and the Nasdaq slid 1.3%, while the Dow gained 0.3%, showing relative strength. Although indexes are holding near record highs, their directional momentum is increasingly unsettled.

The key global variable is the Middle East. News of progress in U.S.–Iran ceasefire and peace talks sent Brent crude down more than 3% in a day to the mid-$70s per barrel, and West Texas Intermediate fell into the low $70s. While lower oil prices ease inflationary pressures, the 10-year U.S. Treasury yield rose to 4.50%, boosting the odds of further Fed rate hikes. Markets are on edge ahead of this week’s May PCE inflation report, watching to see if inflation reaccelerates into the low-4% range.

Among individual stocks, big tech saw notable corrections. Alphabet dropped nearly 5%, and Amazon and Broadcom each declined over 4%, dragging the Nasdaq and S&P 500 lower. SpaceX, which had surged on AI optimism post-listing, plunged about 16% as investors locked in gains. By contrast, AbbVie climbed more than 6% after agreeing to acquire rare-disease biotech Apogee Therapeutics for roughly $10.9 billion, signaling a defensive shift into healthcare.

Since the new Fed chair took office, the central bank has scaled back on outlining a clear rate path, emphasizing it will “decide based on incoming data and market conditions.” That stance is likely to amplify short-term volatility. With Middle East negotiations, the PCE inflation report and Micron’s earnings all set to concurrently impact the market’s “rates–oil–AI valuation” triangle this week, investors would be wise to focus on the interplay of these three factors rather than on index levels alone.