Global stock markets slid sharply on Monday as a deepening tech sell-off eclipsed signs of progress in U.S.-Iran negotiations. S&P 500 and Nasdaq futures fell, while South Korea's Kospi dropped over 6%, according to CNBC. The rout came despite a landmark cease-fire deal signed last Wednesday between Washington and Tehran.
High-level talks between the two countries continued over the weekend at the Bürgenstock resort in Switzerland, led by Vice President JD Vance alongside envoys Steve Witkoff and Jared Kushner. A U.S. diplomat told Axios the meetings ran nearly nonstop into the night and proceeded even after Iran threatened to close the Strait of Hormuz again. Representatives from the U.S., Iran, Pakistan and Qatar expressed satisfaction with the progress, and Qatari and Pakistani mediators issued a joint statement citing "encouraging progress" in the nuclear negotiations.
Despite the diplomatic momentum, fears over AI valuations and rising interest rates triggered a broad sell-off in megacap tech names. According to Yahoo Finance, the Dow, S&P 500, and Nasdaq all saw futures dive as investors fled high-growth stocks. Oil prices slipped, with the WSJ noting crude declined on the prospect of easing supply disruptions.
The disconnect between geopolitical headlines and market action underscores investor caution. While a longer-term nuclear deal would reduce the risk of supply shocks, the tech-heavy market remains fixated on macro pressures. Asia's largest semiconductor hub, South Korea, bore the brunt of the pain as the Kospi tumbled more than 6%.
Some analysts viewed the tech rout as overdue, arguing that elevated valuations and crowded positioning in AI-related stocks had left the sector vulnerable to a sudden repricing. The cease-fire itself remains fragile. President Trump threatened to seize and toll the Strait of Hormuz and kill Iran's peace negotiators, while Israel intermittently bombed Lebanon. Both sides continue to test the deal's limits.