By JBizNews Desk
May 19, 2026

NEW YORK — U.S. stocks closed lower Tuesday for a third straight session as surging Treasury yields, renewed geopolitical uncertainty surrounding Iran, and continued weakness in semiconductor shares pressured Wall Street ahead of Nvidia’s highly anticipated earnings report Wednesday afternoon.

The S&P 500 fell 0.67% to close at 7,353.61, while the Nasdaq Composite dropped 0.84% to 25,870.71. The Dow Jones Industrial Average lost 322.24 points, or 0.65%, finishing at 49,375.46. Selling accelerated during the afternoon after the 30-year Treasury yield climbed to 5.198% — its highest level in nearly 19 years — while the benchmark 10-year yield rose to roughly 4.687%, its highest level since January 2025, intensifying concerns over borrowing costs across mortgages, auto loans, and consumer credit.

Markets also continued reacting to developments in the Middle East after President Donald Trump said he had postponed planned U.S. military action against Iran following requests from regional leaders pursuing what he described as “serious negotiations” toward a broader peace framework. While the announcement helped equities recover from steeper intraday losses, investors remained cautious after Trump later suggested the delay could be temporary. Meanwhile, Brent crude hovered above $110 per barrel for much of the session, reinforcing inflation fears already building inside bond markets.

One of the day’s biggest earnings reports came from Home Depot, which topped Wall Street expectations on both revenue and earnings before the opening bell. The home-improvement giant reported adjusted earnings of $3.43 per share on revenue of $41.77 billion, ahead of analyst estimates calling for $3.41 per share and $41.59 billion in revenue. Comparable sales rose 0.6%, while U.S. comparable sales increased 0.4%.

CEO Ted Decker said the company continued seeing steady demand despite mounting pressure on household budgets and elevated mortgage rates. “The underlying demand in our business was relatively similar to what we saw throughout fiscal 2025, despite greater consumer uncertainty and housing affordability pressure,” Decker said in the company’s earnings release.

CFO Richard McPhail told CNBC that core homeowners remain “engaged,” though larger renovation projects continue to slow as financing costs rise. Home Depot reaffirmed its full-year guidance, forecasting total sales growth between 2.5% and 4.5% and adjusted earnings-per-share growth ranging from flat to up 4%.

Housing-related stocks weakened sharply alongside rising yields. The iShares U.S. Home Construction ETF (ITB) fell more than 1%, while shares of D.R. Horton, Lennar, and Toll Brothers all closed lower, with Toll Brothers declining roughly 2%.

Semiconductor shares once again remained at the center of market attention as investors positioned ahead of Nvidia’s earnings report, widely viewed as one of the most important corporate catalysts of the quarter. The Philadelphia Semiconductor Index traded down more than 1% intraday before recovering some losses into the close. Nvidia shares ended the session down nearly 1%, while Qualcomm fell more than 4% and Broadcom lost roughly 2%.

Memory-chip stocks provided one of the few pockets of resilience inside the technology sector. Micron Technology rebounded more than 4% intraday before finishing roughly flat, snapping a three-session losing streak. Sandisk gained nearly 3%, while the Roundhill Memory ETF (DRAM) rose about 2%.

Jed Ellerbroek, portfolio manager at Argent Capital Management, told CNBC the recent weakness in semiconductors may simply reflect profit-taking after months of explosive gains. “A well-deserved breather after an epic rally,” Ellerbroek said.

On the analyst front, UBS upgraded Jazz Pharmaceuticals to buy from neutral and raised its price target to $307, implying upside of more than 33% from Monday’s close. Analyst Ashwani Verma pointed to growing optimism surrounding the company’s gallbladder-cancer treatment Ziihera ahead of its August 25 regulatory deadline, while also highlighting continued stability across Jazz’s sleep-disorder drug franchise despite pricing pressures and increased competition expected later this year.

Still, the dominant story on Wall Street remained the sharp move higher in long-term Treasury yields. Strategists said investors are increasingly grappling with a combination of rising federal borrowing needs, oil-driven inflation concerns tied to the Iran conflict, and uncertainty surrounding monetary policy under new Federal Reserve Chair Kevin Warsh.

Nathan Peterson, director of derivatives research and strategy at the Schwab Center for Financial Research, said investors should focus less on the absolute level of yields and more on how quickly rates continue moving higher. “Higher yields are not necessarily a bull market killer, because it depends on why they are going up and the velocity of the move,” Peterson said.

Attention now shifts squarely to Nvidia’s earnings release Wednesday afternoon, which many investors view as the next major test for a market attempting to stabilize after its powerful rally from March lows. Investors will also closely watch Walmart’s earnings report Thursday for additional insight into the health of the U.S. consumer as gasoline prices climb and confidence begins to soften.

— JBizNews Desk

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