Memory cratered, defense bid through the summit weekend
Micron lost another 5.9%. Sandisk 5.3%. Western Digital 6.2%. Lockheed bid 2.4%, Raytheon 2.8%. The summit specifics that emerged over the weekend have not converted to a deal. Polymarket prices the US-China tariff agreement by May 31 at 14%.
Treasury Secretary Bessent said Sunday that a deal under consideration would cut tariffs on roughly $30 billion of Chinese-made imports he described as "low-end consumer goods" the US has no interest in manufacturing domestically. USTR Greer said the US expects China to buy "double-digit billions" of US farm goods over the next three years. Chinese state media described the summit as productive and signaled tariff cuts and farm market access. Both sides described the agreements as preliminary, to be finalized as soon as possible.
Polymarket priced the US-China tariff agreement by May 31 at 14% Monday afternoon, down from 22% Friday and 64% Thursday. A 50-point drop in four trading days. The market is treating Bessent and Greer's weekend specifics as more talk, not a deal. The probability of Trump announcing a China tariff reduction sits at 10%, down from 46% Thursday.
MU closed at $681.54, down 5.9% on the day. The stock has now lost $137 from its May 11 peak of $818, a 17% drawdown over six sessions. SNDK closed at $1,333.01, down 5.3%. WDC closed at $458.68, down 6.2%. The memory blowoff that ran through last Monday has fully turned. The trade-driven rally has unwound, and what is left is the cyclical cycle question, which is more cautious.
The other AI-supplier names held. NVDA closed at $222.32, down 0.9%. AMD at $420.99, down 1.1%. AVGO at $420.71, up 0.8%. The memory dispersion specifically is the signal. The hyperscaler-AI logic chips are flat. The DRAM and NAND names are cracking.
LMT closed at $528.31, up 2.4% on the day. RTX at $175.95, up 2.8%. NOC at $550.00, up 1.7%. The defense names that traded flat through ten weeks of Middle East war and underperformed the broader tape by 15-20 percentage points over the month finally found a bid Monday.
The catalyst is the Taiwan arms decision that Trump deferred Friday in Beijing. Trump stated he had not made a decision on whether to proceed with the next arms sale package to Taiwan. That decision is the residual lever from the summit. If the package proceeds, LMT, RTX, NOC, and the broader defense complex pick up incremental orders. Monday's bid is the market repricing higher probability that the package goes through, given the summit produced no concession from Trump on the Taiwan side.
GM closed at $73.10, down 2.3% on the day and down 7.1% over the past month. GM's Q1 2026 10-Q discloses that Automotive China JVs generated $165 million of equity income in Q1 2026 versus $45 million in Q1 2025, a 267% year-over-year increase. The Automotive China JV net sales ran $5.69 billion versus $5.07 billion prior-year, up 12%. The Q1 number includes $0.1 billion tied to the previously announced restructuring of SAIC General Motors Corp. The market is pricing GM as a melting Detroit OEM. The filing shows the China JV restructuring producing real recurring income for the first time in years.
AVGO's 10-Q shows the AI custom-silicon growth story is not China-dependent. Hock Tan has targeted $100 billion of AI chip revenue by 2027. The named custom-silicon customers are Google, Meta, Anthropic, OpenAI, and two unnamed hyperscalers. Zero Chinese hyperscalers. AVGO at $420.71, up 6.4% over the past month, is properly decoupled from summit outcomes because its growth comes from US AI buildout, not Chinese demand.
TSLA closed at $409.99, down 2.9% on the day. Musk's presence in the Beijing delegation has not produced disclosed concessions on FSD approval or Shanghai gigafactory expansion. TSLA's filing shows 11 mentions of Shanghai and 20 of gigafactory, plus 36 NIO mentions. The competitive position is the bigger filing concern than the structural exposure.
ADM closed at $80.91, up 1.7% on the day, and is up 17.6% over the past month. The "double-digit billions" farm purchase commitment Greer named is the cleanest summit deliverable that has actually priced into a US equity. CF Industries at $125.22, up 1.9% on the day. Deere at $564.49, up 0.6% but down 5.5% over the past month. The farm equipment cycle is a second-derivative play: rising farm income from the China purchase commits would lift farm capex with a six-to-twelve-month lag. DE has not priced that yet.
USO closed at $149.29, up 1.9% intraday. XLE at $60.58, up 1.9%. WTI futures closed at $102.49, up 1.5%. Brent at $109.72, up 0.4%. Physical Mars Gulf Coast crude at $120.05, up 2.6%. Iran sits unresolved through the summit. China interest in buying more US energy was vague but bullish on directional flow. The energy bid is residual Iran tightness layered with the post-summit framework.
LVS closed at $50.19, down 1.7% on the day and 10.5% over the past month. WYNN at $95.51, flat on the day, down 12.3% over the past month. The summit produced nothing for Macau. The concession-renewal trade I described two weeks ago was the wrong mechanism. LVS's 10-K confirms the gaming concession is locked through December 2032. The actual variable is Macao GGR recovery. Wynn's Q1 2026 disclosed Wynn Palace casino revenue at $564.9 million, up 27% year over year. A data point the equity is not pricing.
TLT closed at $83.56, down 0.1% on the day. The bond market is taking the summit-was-status-quo as confirming higher-for-longer. The Polymarket probability of no Fed rate cuts in 2026 sits at 69%. Friday's 1.5% TLT drop on the summit conclusion priced the no-deal scenario. Monday's flat tape held the level.
This week brings Empire State Manufacturing, Existing Home Sales, the Philly Fed survey, and Walmart and Lowe's earnings. AMAT reported Thursday after close last week and pre-market price action set the tone Friday. The next Trump-Xi meeting is scheduled for fall 2026. The intermediate test of the summit framework is whether Bessent's $30 billion consumer-goods tariff cut and Greer's "double-digit billions" farm purchase commit get formalized within weeks.