The U.S. dollar weakened against most major currencies on Monday as investors unwound part of last week's safe-haven positioning following signs of easing tensions between the United States and Iran.

The U.S. Dollar Index, which measures the greenback against a basket of six major currencies, hovered around 101.3 during European trading after slipping roughly 0.3% from Friday's levels. The euro rose about 0.3% to around $1.14, while the Japanese yen and British pound also strengthened against the dollar.

Why is the dollar weakening?

The dollar's decline has less to do with U.S. economic data and more with a sharp shift in market sentiment.

The temporary pause in hostilities between Washington and Tehran triggered a steep decline in oil prices, reducing fears of another inflation shock. As oil retreated, U.S. Treasury yields also moved lower, diminishing one of the dollar's biggest sources of support over the past two weeks.

At the same time, investors rotated back toward riskier assets, reducing demand for the dollar's traditional safe-haven appeal.

All eyes on the Federal Reserve

Despite today's pullback, few investors appear willing to make aggressive bets against the dollar ahead of this week's Federal Reserve meeting.

The central bank is widely expected to leave interest rates unchanged, but markets will closely scrutinize Chair Kevin Warsh's comments for clues about the policy outlook. While expectations for a July rate hike have eased, traders continue to see a meaningful possibility of tighter policy later this year if inflation remains elevated.

This week's calendar also includes several key U.S. economic releases that could reshape expectations for the path of interest rates and, in turn, the direction of the dollar.

Outlook

For now, the dollar appears to be caught between two competing forces.

On one hand, easing geopolitical tensions, lower oil prices and softer Treasury yields are weighing on the currency. On the other, the Federal Reserve continues to maintain a relatively restrictive policy stance, limiting the scope for a deeper decline.

Unless geopolitical tensions flare up again, the dollar's direction over the next few days is likely to be driven primarily by the Federal Reserve's policy decision, Chair Warsh's remarks and incoming U.S. economic data rather than developments in the Middle East.

Gold and silver traded higher on Monday morning as investors returned to precious metals after last week's volatility, with a weaker U.S. dollar and falling Treasury yields providing support despite signs of easing tensions between the United States and Iran.

Spot gold climbed about 0.9% to around $4,088 an ounce during early trading, while spot silver outperformed with a gain of roughly 1.5% to around $59.1 an ounce. Platinum and palladium also moved higher as investors broadly returned to the precious metals complex.

Why are gold and silver rising?

At first glance, today's gains may seem surprising.

The apparent pause in hostilities between Washington and Tehran has sent oil prices sharply lower, reducing immediate inflation concerns and easing demand for traditional safe-haven assets. Under normal circumstances, that would weigh on gold.

Instead, the decline in oil has pushed the U.S. dollar lower and helped pull Treasury yields down, improving the appeal of non-yielding assets such as gold and silver. Investors are increasingly focusing on those financial conditions rather than the immediate geopolitical headlines.

Silver continues to outperform

Silver once again posted stronger gains than gold, reflecting its dual role as both a precious and industrial metal.

Alongside support from lower yields, silver continues to benefit from expectations that long-term demand from artificial intelligence infrastructure, data centers, solar panels and electronics manufacturing will remain robust. That combination often allows silver to outperform gold when broader market sentiment improves, although it also tends to experience larger price swings.

What traders are watching next

The focus is now shifting toward one of the busiest weeks of the summer for financial markets.

The Federal Reserve is widely expected to leave interest rates unchanged, but investors will closely analyze Chair Jerome Powell's comments for clues on the timing of future policy moves. Markets will also monitor upcoming U.S. inflation and growth data, both of which could influence Treasury yields and the U.S. dollar.

For the next few sessions, precious metals are likely to remain caught between two opposing forces: easing geopolitical risks that reduce safe-haven demand, and expectations for a softer interest-rate outlook that continue to support bullion prices. Unless a fresh geopolitical surprise emerges, the Federal Reserve is likely to be the dominant driver of both gold and silver through the rest of the week.

For years, China's semiconductor ambitions were measured in promises, but today, investors are beginning to value them in hundreds of billions of dollars.

ChangXin Memory Technologies, better known as CXMT, delivered one of the most extraordinary stock market debuts in recent history on Monday. Shares surged more than 500% in early trading after the company raised $8.6 billion in Asia's largest IPO of the year, briefly lifting its market value above half a trillion dollars and making it China's most valuable listed company.

At first glance, the enthusiasm appears difficult to justify.

CXMT is neither the world's largest chipmaker nor its most profitable. It still trails industry leaders Samsung, SK Hynix and Micron in both technology and global market share.

Yet investors are valuing the company as though it represents something much larger than a manufacturer of memory chips.

In many ways, that is exactly what they are buying.

A company at the center of China's technological ambitions

The semiconductor industry has changed dramatically over the past few years.

Memory chips were once viewed as one of the industry's most cyclical businesses. Prices rose and fell with consumer electronics demand, and investors largely judged companies by production costs, market share and pricing power.

Artificial intelligence has fundamentally altered that equation.

Every large language model, AI server and advanced data center requires enormous amounts of high-performance memory. Faster processors alone are no longer enough. Without vast quantities of DRAM, even the world's most advanced AI chips cannot reach their full potential.

That has transformed memory from a commodity into one of the critical foundations of the AI economy.

For China, the stakes are even higher.

Years of U.S. export restrictions have made semiconductor self-sufficiency one of Beijing's highest industrial priorities. Rather than relying indefinitely on foreign suppliers, China has spent years building domestic champions capable of competing across every major segment of the chip industry.

CXMT has become one of the clearest symbols of that strategy.

Investors are buying a national strategy

This helps explain why traditional valuation metrics alone struggle to capture today's enthusiasm.

Investors are not simply estimating how many memory chips CXMT might sell next year.

They are trying to estimate what China's determination to secure its own semiconductor supply chain could ultimately be worth.

Few industries enjoy this combination of powerful tailwinds.

Artificial intelligence is expanding demand for memory at an exceptional pace. At the same time, geopolitical tensions are encouraging governments and technology companies to diversify supply chains and reduce dependence on overseas manufacturers.

For many investors, those two forces reinforce one another.

The result is a company that sits at the intersection of two of the world's most powerful investment themes: AI infrastructure and technological sovereignty.

That combination rarely comes cheaply.

Why the valuation is making investors nervous

The excitement, however, has been matched by growing skepticism.

Even after accounting for strong earnings growth and expectations of rapidly expanding production, CXMT's valuation now assumes years of extraordinary execution. That leaves little room for setbacks.

The company's public float also remains relatively small, meaning heavy demand can have an outsized impact on the share price, particularly during the first days of trading. Analysts have warned that such conditions often amplify volatility, especially following blockbuster IPOs.

There is another concern.

Memory has always been one of the semiconductor industry's most cyclical businesses.

Periods of soaring profitability often encourage aggressive capacity expansion. Eventually, additional supply catches up with demand, prices weaken and margins come under pressure.

Some investors are already questioning whether today's optimism adequately reflects that historical pattern.

A new challenge for the global chip industry

Whether CXMT ultimately justifies its valuation may prove less important than what its emergence signals for the broader industry.

Until recently, the global DRAM market was effectively dominated by Samsung, SK Hynix and Micron.

China's rapid progress introduces a credible fourth major competitor with significant financial backing and clear strategic importance to Beijing.

That could reshape competitive dynamics over the coming years.

Greater capacity may eventually place downward pressure on memory prices, benefiting AI developers and cloud computing companies while increasing pressure on established manufacturers to maintain profitability.

At the same time, continued technological competition between China and the United States is likely to accelerate investment across the entire semiconductor ecosystem rather than slow it.

More than an IPO

The remarkable thing about CXMT's debut is not simply that investors pushed its valuation into the hundreds of billions of dollars.

It is what that enthusiasm represents.

Markets increasingly believe that semiconductors are no longer just another industry. They have become strategic infrastructure, as important to economic and technological leadership as railroads, electricity or the internet were in previous generations.

That is why investors are willing to place extraordinary valuations on companies positioned at the center of this transformation.

Whether CXMT ultimately grows into its enormous valuation remains an open question.

What seems increasingly clear, however, is that the company is no longer being judged solely by the memory chips it manufactures.

It is being valued for the role investors believe it could play in determining who leads the next era of global technology.

Only a few weeks ago, SpaceX seemed untouchable.

Its blockbuster public debut briefly propelled the company above some of the world's largest technology firms by market value, turning Elon Musk into the first trillionaire and reinforcing the belief that investors were witnessing the birth of the market's next great growth story.

Today, the mood could hardly be more different.

SpaceX shares have surrendered nearly half their value from their post-IPO peak, fallen below their offering price and become one of Wall Street's most heavily scrutinized stocks. At the same time, short sellers have accumulated an estimated $15.5 billion in paper profits since the company's June listing, transforming what was once the market's hottest trade into one of its most profitable bearish bets.

A great company can still be a difficult stock

The remarkable part of SpaceX's decline is that the company itself has not suddenly become a weaker business.

Falcon launches continue at an industry-leading pace. Starlink remains one of the fastest-growing satellite internet businesses in the world. NASA and commercial customers still rely heavily on the company's launch capabilities.

What changed was not the business, but the expectations surrounding it.

When SpaceX came to market, investors were willing to pay almost any price for exposure to one of the world's most ambitious technology companies. The stock quickly became a symbol of optimism surrounding reusable rockets, artificial intelligence infrastructure, satellite communications and the future of space exploration.

Those expectations left very little room for disappointment.

Why the bears suddenly found an opportunity

That is precisely where short sellers entered the picture.

Contrary to popular belief, short sellers rarely target weak companies alone. More often, they target companies whose valuations leave almost no margin for error.

SpaceX offered exactly that setup.

Starship, arguably the company's most important long-term project, has suffered repeated launch delays, pushing back another key milestone investors were eagerly awaiting. Meanwhile, Wall Street is beginning to focus on issues that barely mattered during the IPO euphoria, including lock-up expirations that could release a significant number of additional shares into the market and an earnings report that will provide the first real test of whether the company's financial performance can justify its extraordinary valuation.

None of these developments necessarily threaten SpaceX's future.

Collectively, however, they have changed the conversation from limitless potential to measurable execution.

The battle is really over expectations

The surge in bearish positioning says less about SpaceX's technology than it does about Wall Street's willingness to challenge expensive narratives.

Only weeks ago, betting against SpaceX looked almost reckless. Today, those same bearish positions are among the market's biggest winners.

That shift illustrates how quickly sentiment can reverse once investors begin asking different questions.

Instead of wondering how large SpaceX could eventually become, the market is asking whether today's valuation already assumes too much success too soon.

That is a far more difficult question to answer.

Pressure is becoming part of the investment story

Going public has changed the company in another important way.

For years, SpaceX largely operated outside the relentless scrutiny faced by publicly traded giants. Delays were engineering challenges rather than market-moving events. Ambitious timelines inspired excitement instead of quarterly debates.

That luxury no longer exists.

Every postponed Starship launch now affects investor confidence. Every earnings report becomes a referendum on growth. Every analyst downgrade or insider selling headline can influence billions of dollars in market value.

The company is no longer judged solely by the scale of its ambitions. It is increasingly judged by its ability to meet them on Wall Street's timetable.

The next chapter will determine who was right

The current selloff does not necessarily prove the bulls were wrong or the bears were right.

Instead, it reflects a market moving from excitement to evaluation.

SpaceX remains one of the world's most innovative companies, but innovation alone is rarely enough to support a premium valuation indefinitely. Investors eventually demand evidence that ambitious visions can translate into financial results.

That is why the coming months may matter more than the spectacular IPO that captured global attention.

For short sellers, the recent collapse suggests the market has finally begun questioning expectations that once seemed unquestionable.

For long-term investors, the decline raises a different possibility.

Sometimes Wall Street's biggest target is simply yesterday's biggest favorite, and the companies that survive that transition often emerge stronger than before. Whether SpaceX joins that list will depend less on the brilliance of its vision than on its ability to convince investors that the vision can be delivered on schedule.