Monday's Numbers
On Monday, May 18, 2026, the market showed a mixed picture after the recent record high. The S&P 500 closed at 7,408.50 points — a decline of 1.24% or 92.74 points from Friday. The index had hit a new all-time high of 7,501.24 on Thursday before the correction set in on Friday.
The DAX moved sideways with slight gains, while Asian markets closed mixed. Treasury yields rose sharply, putting pressure on equity markets. Oil futures (WTI) continued to climb, weighing on inflation expectations.
The Day's Winners
ServiceNow (NOW) led the gainers with a rise of +6.55%. The stock rebounded after weeks of weakness and recorded trading volume of 26.14 million shares. Options traders bet on short-dated calls — the expected move for options expiring May 15 was ±$2.82 (3.24%).
Thomson Reuters (TRI) also shone with +5.58%, while the Magnificent Seven performed mixed. Tesla came under pressure and posted the largest decline in this group.
The Losers: Rackspace in Free Fall
On the losing side, Rackspace Technology (RXT) dominated, crashing 14% to 18%. The stock fell from $5.82 (Friday) to approximately $5.01 on Monday — a continuation of Friday's -20.16% crash. From the intraday peak of $7.29 on May 15, this represents a combined loss of 31% in just two trading days.
The reason: A short squeeze and AI euphoria around an AMD partnership drove the stock from under $2 to over $7 — with no fundamental basis. The FY2026 EPS guidance is between -$0.15 and -$0.20, and equity is negative at -$1.2 billion. What began as a momentum trade ended in classic capitulation.
What Options Traders Are Watching Now
SPY puts expiring May 18 were highly active, especially the 736.000 strike. Volume suggests institutional investors are hedging despite new highs. The VIX remained below 12 — unusually low for a market environment marked by rising yields and geopolitical uncertainties.
Call traders on ServiceNow bet on the 225 strike for May, while the put side exploded on Rackspace. Those who bought puts in time could capture triple-digit returns.
The market remains tense between record euphoria and correction risk — a classic situation for options traders with hedging strategies.
Disclaimer: This article is for informational purposes only and does not constitute investment advice. Past performance is not an indicator of future results.