U.S. stocks closed lower on Aug. 17 as a rise in oil prices and caution ahead of earnings from major retailers weighed on sentiment, even as optimism around AI infrastructure spending lifted semiconductor shares. The Dow Jones Industrial Average fell 272.63 points, or 0.51%, to 53,459.78, the S&P 500 dropped 40.70 points, or 0.52%, to 7,745.06, and the Nasdaq Composite declined 84.25 points, or 0.31%, to 26,644.91. Crude gained more than $2 per barrel as investors assessed global supply risks and fading expectations for a diplomatic breakthrough between the United States and Iran, helping make energy the only advancing S&P 500 sector with a 0.87% gain. Communication services and consumer staples each fell about 1.5%, while financials and consumer discretionary dropped more than 1%. Investors are now watching retail results from Home Depot on the 18th, Lowe's on the 19th and Walmart on the 20th after weak July retail sales and employment data heightened concern about the consumer outlook. Phil Blancato, chief market strategist at Osaic Wealth, said the market was showing caution as reduced summer trading volumes coincided with anticipation around consumer data. Chipmakers and related suppliers outperformed, with the Philadelphia Semiconductor Index up 1.6%, Micron Technology gaining more than 4%, Applied Materials rising 5.5% and SK Hynix ADRs (U.S.-traded depositary receipts) up nearly 4%. Enthusiasm was supported by news that AI startup Anthropic generated $11.5 billion in second-quarter revenue, up 14-fold from a year earlier, and posted its first quarterly operating profit, reinforcing expectations for demand across AI hardware. Reuters had previously reported that Anthropic, which is preparing for an IPO (initial public offering), projects 2028 revenue of about $190 billion to $200 billion. Another boost came from U.S. Commerce Secretary Howard Lutnick's stated opposition to Apple's purchases of Chinese-made memory chips, a development that investors viewed as potentially strengthening the pricing power of U.S. and South Korean memory makers if Chinese companies face tighter access to the U.S. market. Software stocks moved the other way, with the S&P 500 software and services index down 2.8% and Microsoft and Meta Platforms each falling more than 3% to lead the broader market lower. The moves pointed to a rotation away from software and platform companies absorbing heavy AI spending and toward semiconductor suppliers seen as beneficiaries of AI infrastructure buildouts. Attention is now shifting to Nvidia's earnings next week, which investors see as a major gauge of how long Big Tech can sustain current AI infrastructure investment. Elsewhere, Vista's U.S.-listed shares jumped 5.6% after Peter Thiel bought a 1% stake in the Latin American oil company. Market breadth was negative, with decliners beating advancers by 1.76-to-1 on the NYSE and 1.68-to-1 on the Nasdaq. Total U.S. exchange volume was 14.74 billion shares, below the 20-day average of 16.95 billion. The Federal Reserve will release minutes from its latest FOMC (Federal Open Market Committee) meeting on the 19th, and no major economic indicators are due this week.