Stocks close lower to start the week as Nvidia's gains fail to prop up Nasdaq

Stocks finished in negative territory on Monday.

The Nasdaq Composite fell 0.22% to close at 21,449.29, and the S&P 500 dropped 0.43% to end at 6,439.32. The Dow Jones Industrial Average slid 349.27 points, or 0.77%, to settle at 45,282.47.

— Sean Conlon

The artificial intelligence boom remains robust even amid worries among investors that it's in a bubble, according to Louis Navellier of Navellier & Associates.

"The AI narrative remains strong, despite increasing comments about an 'AI Bubble' being heard," the firm's founder and chief investment officer said. "The NVIDIA earnings this Wednesday are critical to the AI story and will have a wide impact if it disappoints, and likely lead to new highs if guidance is stronger than expected."

Earlier this month, OpenAI CEO Sam Altman revealed that he sees a bubble in the AI market developing, saying that he thinks that "investors as a whole are overexcited about AI."

— Sean Conlon

The market has continued upside ahead, particularly as the Federal Reserve's latest signal supports the momentum for equities, according to Jeremy Siegel.

"I don't think we're going to be 20% higher, but 5% to 10% higher within the next six months certainly seems like in the realm of possibility. I think this bull market is certainly still intact, earnings provisions are still upward, and finally, as you know, I've been calling for lower short term rates," Siegel, WisdomTree chief economist and Wharton professor emeritus, told CNBC on Monday.

Siegel added that the Fed funds rate should be 100 basis points below the 10-year yield. "I think it is heading down there, and I think that's a great comfort to investors," he said.

Expectations for a quarter-point rate cut in September are sitting at 84.2%, according to the CME Group's FedWatch tool.

— Pia Singh

Sentiment regarding where the U.S. economy could be headed over the coming months remains divided, UBS said on Monday.

"The OECD CLI used in our REVS framework continues to switch between slowdown and expansion," strategist Sean Simonds wrote.

"Sector PMIs for the S&P 500 though continue to reflect a more buoyant expansionary mood," he added. "Our market implied economic regime probability also suggests markets are pricing a more optimistic outlook (Goldilocks probability increased to 32%)."

The strategist also said that while earnings growth has been slower, it's been strong nonetheless, with the S&P 500 on track to see earnings per share growth of approximately 9% this year.

— Sean Conlon

Tom Lee, Fundstrat co-founder and former JPMorgan strategist, is preparing to launch two new exchange-traded funds (ETFs).

On Monday, Fundstrat Capital announced that it has filed a preliminary prospectus with the U.S. Securities and Exchange Commission for two new ETFs: the Fundstrat Granny Shots U.S. Small- & Mid-Cap ETF and the Fundstrat Granny Shots U.S. Large Cap & Income ETF.

This comes after Lee's first ETF known as the Fundstrat Granny Shots US Large Cap ETF (GRNY) surpassed $2 billion in assets under management just less than nine months after its inception in November.

— Sean Conlon

Investors should take advantage of their sitting cash as the market looks forward to easing monetary policy.

"We expect Powell to advocate for easing at the September meeting unless incoming data, such as a strong August labor report or higher-than-expected inflation, provide reason to stay on hold. Against this backdrop, we anticipate four quarter-point rate cuts through January 2026, starting in September," Mark Haefele, chief investment officer for UBS wealth management's chief investment office, said in a Monday note to clients.

"The time to put cash to work is now, as the Fed looks set to resume rate cuts in September and rates in much of Europe are already low," Haefele added.

The firm encouraged to buy the dip in equities, expecting further upside over the next six to 12 months in global stocks based on the Fed's expected moves and strong capex momentum. U.S. tech, health care, utilities and financials remain UBS' preferred sectors.

— Pia Singh

Warren Buffett met with CSX's chief executive and discussed greater cooperation even though Buffett is not looking to buy another railroad, he told CNBC's Becky Quick on Monday.

The Berkshire Hathaway chairman as well as CEO designate Greg Abel met with the CSX CEO, Joseph Hinrichs, in Omaha on Aug. 3, doing so in his office without any advisors in attendance. While both made clear to Hinrichs that they would not make a bid for CSX, they believed they could cooperate more and gain some of the same benefits from combining the two companies.

CSX shares were last down about 6% following the news.

— Spencer Kimball

Okta is reaching an inflection point as headwinds abate and its all-in-one identity platform resonates with customers, according to Truist.

The firm upgraded the identity management service company to buy from hold on Monday and raised its price target to $125 from $100, implying 35% upside from Friday's close.

Truist anticipates increased consolidation within the identity security industry.

"We believe Okta is well-positioned to consolidate the identity security market because of their large installed base, their ubiquity within organizations as the leading SSO/MFA vendor, and penetration downmarket, where organizations are more likely to consolidate onto a single platform over choosing best of breed," analyst Junaid Siddiqui wrote in a note.

Shares are up more than 17% year to date.

— Michelle Fox

Check out the stocks making big moves in midday trading Monday:

• Vital Energy — The energy company surged 13% after announcing it will be acquired by Crescent energy for $3.1 billion. The deal is expected to close by year-end.
• MP Materials — Shares of the mining company jumped nearly 7%. While a catalyst wasn't immediately clear, the move comes after President Donald Trump said the government will make more deals similar to the one made with Intel. Last month, the Pentagon became the largest shareholder in MP Materials.
• Apple — The iPhone maker traded higher even after two of Elon Musk's companies, social media platform X and startup xAI, sued the tech giant as well as OpenAI — alleging the pair engaged in an "anticompetitive scheme" to hurt AI rivals.

For the full list of stocks, read here.

— Fred Imbert

On Monday, 11 stocks in the S&P 500 were trading at new 52-week highs.

Tickers that hit this milestone are as follows:

• Alphabet C share trading at all-time highs back to the special distribution on April 2, 2014, when (the non-voting share was created, and it began trading on April 3, 2014)
• Alphabet A share trading all-time highs back to its IPO on August 19, 2004
• Aptiv trading at levels not seen since August 2024
• Wynn trading at levels not seen since May 2023
• Archer-Daniels-Midland trading at levels not seen since July 2024
• Citizens Financial Group trading at levels not seen since March 2022
• State Street trading at all-time high levels back through our history to 1972
• United Rentals trading at all-time high levels back to its IPO in December 1997
• Corning trading at levels not seen since January 2001
• Seagate trading at all-time highs back to its IPO in December 2002
• Newmont Mining trading at levels not seen since May 2022

— Christopher Hayes, Lisa Kailai Han

Elon Musk's artificial intelligence startup xAI and social media platform X sued Apple and OpenAI on Monday, accusing the two of an "anticompetitive scheme."

The lawsuit alleges that Apple and OpenAI have "colluded" to hold monopolies over the smartphone and generative artificial intelligence markets.

The suit also accuses Apple of deprioritizing "super apps" and generative AI chatbot competitors like xAI's Grok in its App Store rankings.

"Unless the court enjoins Apple and OpenAI's unlawful conduct, defendants will continue to thwart competition, and their competitors, like plaintiffs, will continue to suffer the anticompetitive consequences," the complaint, filed in U.S. District Court for the Northern District of Texas, said.

— Annie Palmer

Keurig Dr Pepper's roughly $18 million offer for Dutch coffee and tea company JDE Peet's will shake up the global coffee industry and create stronger competition for Nestle, Barclays said in a note Monday.

Shares of Keurig Dr Pepper shed 7% in midday trading.

"For KDP, two pure play beverage companies listed in the US makes sense," analysts Lauren Lieberman and Patrick Folan wrote.

"Although coffee and carbonated beverages are similar categories, they do have unique characteristics which means that a more targetted approach around growth and capital allocation makes sense in our view," they added.

However, while JDE Pete's holders will receive a decent premium, the offer is only 1% higher than the company's initial public offering price, they said.

— Michelle Fox

Bank of America sees American Eagle's Sydney Sweeney boost soon coming to an end.

Analyst Christopher Nardone downgraded the stock to underperform from neutral and lowered his price objective to $10 per share from $11, suggesting more than 21% downside from Friday's close.

His downgrade comes ahead of the retailer's second-quarter earnings release on Sept. 3. The analyst noted that the boost from the Sweeney ad push will be eroded by higher tariffs.

"AE and Aerie are in tough positions to navigate tariffs; we do not think that either brand has much pricing power," he wrote. "We cut our F25/F26 EPS estimates by 8%/30% to $0.65/$0.95 to reflect the impact of higher tariffs and lower Aerie sales."

CNBC Pro subscribers can read more here.

— Lisa Kailai Han

President Donald Trump said that the U.S. government will make more deals that are reminiscent of its recent stake in Intel.

"I PAID ZERO FOR INTEL, IT IS WORTH APPROXIMATELY 11 BILLION DOLLARS. All goes to the USA. Why are 'stupid' people unhappy with that? I will make deals like that for our Country all day long," the president wrote in a post on Truth Social, adding that he will "help those companies that make such lucrative deals" with the U.S.

"I love seeing their stock price go up, making the USA RICHER, AND RICHER," he also said. "More jobs for America!!! Who would not want to make deals like that?"

— Sean Conlon

Stocks traded down on Monday morning, reversing course from Friday's rally.

The S&P 500 slid 0.3% shortly after the opening bell, along with the Nasdaq Composite. The Dow Jones Industrial Average also pulled back 84 points, or 0.2%. 

— Sean Conlon

Check out some of the companies making headlines in premarket trading.

• Keurig Dr Pepper — Shares slid more than 3% after the beverage maker said it would acquire Dutch coffee and tea company JDE Peet's for around $18 billion. Once the deal is completed, Keurig plans to split its beverage and coffee businesses into two separate, publicly traded U.S. companies.
• Verint Systems -- The call center software company popped 12% following a Bloomberg report that private equity Thoma Bravo was on the verge of a deal to acquire it. The deal, which could be announced Monday, values Verint at about $2 billion, said Bloomberg, citing people familiar with the matter.
• Furniture stocks — Shares moved mostly lower in premarket trading following comments from President Donald Trump that said his administration would launch an investigation into imported units. William-Sonoma slipped more than 3%, while RH pulled back more than 7%. Ethan Allen advanced more than 3%.

Read the full list here.

— Brian Evans

In a Monday note, Raymond James upgrades shares of Alaska Air Group to an outperform rating from market perform, citing current demand and competitive capacity trends.

Analyst Savanthi Syth introduced a target price of $70 per share, which implies that shares of Alaska Air Group could climb 18% from their Friday closing price. The stock has shed 8% this year.

"As previously noted, Alaska's dominant market position at key airports (thus, better ability to control its destiny), idiosyncratic earnings drivers related to Alaska Elevate along with a long history of good execution, and a reasonably strong balance sheet make ALK an attractive option for long-term focused investors," the analyst wrote. "Moreover, current demand and competitive capacity trends increase the conviction in our earnings forecasts and, in turn, attractiveness of the risk-reward."

In the same note, Syth also downgraded shares of American Airlines to a market perform rating from outperform. The catalyst for the downgrade, the analyst wrote, was a more balanced risk-reward as the stock approaches Raymond James' prior price target of $14.

— Lisa Kailai Han

Orsted shares plummeted on Monday after the Trump administration ordered the Denmark-based wind farm developer to halt construction of a nearly completed project.

Shares of the company had fallen around 17% and hit a record low, according to LSEG data.

The U.S.′ Bureau of Ocean Energy Management late on Friday had issued a stop-work order for the Revolution Wind Project off of Rhode Island, a project that is 80% complete and has seen 45 out of 65 wind turbines installed, according to Orsted.

The company said that it would comply with the order and that it was considering options to resolve the issue and press ahead with construction.

— Sophie Kiderlin

Stifel is reiterating its optimistic view of Nvidia in the leadup to the graphic processing unit designer's upcoming quarterly results on Wednesday.

Analyst Ruben Roy, who maintained his overweight rating on the stock, raised his price target to $212 from $202, which implies 19% upside from Friday's close.

The analyst said "accelerating broad-based demand" for Nvidia's GB300 platform could serve as a tailwind for the artificial intelligence chip darling.

"Our supply chain discussions continue to point to expectations for ramping GB300 orders into year-end even as sustained GB200 demand continues," he wrote. "We expect a modest F2Q beat relative to consensus, as a function of prudent guidance, still-strong CapEx commentary from CSPs, de-risked China headwind with potential sales benefit, and healthily-ramping product sales with seemingly limited supply-chain disruption."

CNBC Pro subscribers can read more here.

— Lisa Kailai Han

Ether ETFs posted $341 million in inflows Friday and its second day in a row of positive flows, according to SoSoValue, led by Fidelity's FETH fund. Meanwhile, bitcoin ETFs saw their sixth consecutive day of net outflows — primarily from BlackRock's popular IBIT fund, while others saw minor inflows.

For the week ending Aug. 22, the ether posted $237 million in net ouflows, which was its first week of negative flows since May 9. Bitcoin ETFs saw more than $1 billion in net outflows in the same week.

The price of ether is pulling back to start the week, after hitting a fresh record of almost $5,000 over the weekend. It was last lower by 6% at under $4,600, according to Coin Metrics.

ETH hit an earlier all-time high late Friday for the first time since 2021.

— Tanaya Macheel

Intel shares were up more than 2% in the premarket, adding to its 5.5% jump on Friday after the U.S. government confirmed it had taken a 10% stake in the chipmaker.

"BIG NEWS: The United States of America now owns 10% of Intel, one of our great American technology companies," Commerce Secretary Howard Lutnick said in a post on X.

— Fred Imbert

Shares of Keurig Dr Pepper dropped more than 3% in the premarket after the company announced a deal to buy Dutch coffee company JDE Peet's for $18 billion.

Following the deal's completion, Keurig plans to split up its beverage and coffee units into two separate, U.S.-listed companies. This move would effectively unwind the 2018 merger between Keurig and Dr Pepper Snapple.

— Fred Imbert, Ruxandra Iordache

Asia markets climbed Monday, led by China and Hong Kong stocks, after Federal Reserve Chair Jerome Powell signaled that the central bank could begin easing monetary policy next month in his widely anticipated annual speech in Jackson Hole, Wyoming.

Mainland China's CSI 300 extended its gains for the fourth consecutive session, climbing 2.08% to end the day at 4,469.22 after hitting a 37-month high earlier in the day.

Hong Kong's Hang Seng Index surged 1.94% to 25,829.91, after coming within range of a four-year high. Gains were led by Zijin Mining Group, which gained 6.38% and NetEase, which jumped 6.04%.

The tech sector was among the key contributors to the HSI's gains. The Hang Seng Tech index rose 3.14% to 5,825.09, with strong moves seen in Nio, which gained 15.17% and semiconductor and electronics manufacturer ASMPT, which added 7.6%.

Strong gains were also seen in Taiwan's Taiex index, which advanced 2.16% to 24,277.38.

Over in South Korea, the Kospi index increased by 1.3% to end the day at 3,209.86, while the small-cap Kosdaq advanced 1.98% to 798.02.

In Japan, the Nikkei 225 benchmark rose 0.41% to close at 42,807.82, while the broader Topix index ticked up 0.15% to 3,105.49.

Australia's S&P/ASX 200 benchmark ended flat at 8,972.40, after crossing the 9,000 threshold earlier in the session.

Over in India, the benchmark Nifty 50 added 0.53%, while the BSE Sensex index moved up 0.51% as of 1:50 p.m. Indian Standard Time (4:20 a.m. ET).

— Amala Balakrishner

Ether rose to a new record over the weekend, after hitting an all-time high Friday for the first time since 2021.

The price of the second largest cryptocurrency rose as high as $4,954.81 on Sunday afternoon. It was last higher by less than 1% at $4,776.46.

Meanwhile, bitcoin at one point erased all the gains from its Friday rally, falling as low as $110,779.01, its lowest level since July 10. It was last trading lower by 2% at about $112,000. The flagship cryptocurrency hit its most recent record on Aug. 13.

— Tanaya Macheel

The market may have rallied last week on Fed Chair Jerome Powell's remarks hinting at rate cuts, but August's CPI and employment reports, and potentially a "few" other indicators, might convince the FOMC to hold off on easing if they are hotter than expected, according to Wall Street strategist Ed Yardeni.

"That's why we are sticking we are sticking with our associated targets for the S&P 500 of 6,600 by year-end 2025 and 7,700 at the end of next year," Yardeni wrote Sunday. "We assign that base-case scenario a subjective probability of 55% ... A meltup will be more likely if the Fed eases in September, as widely expected," which could lift the index to 7,000 by year-end 2025, he added. "We expect that the bull market will be increasingly earnings-led rather than valuation-led through 2026."

— Tanaya Macheel

U.S. equity futures opened flat on Sunday night.

Futures tied to the Dow inched higher by 19 points, or 0.04%. S&P 500 futures added 0.07% and Nasdaq 100 futures rose slightly by 0.1%.

— Tanaya Macheel