(Updates with details about Trump comments on Iran, paragraph 4)

* S&P 500, Nasdaq end lower

* Oil prices gain as Iran worries continue

* Longer-dated US Treasury yields off recent highs

By Caroline Valetkevitch and Samuel Indyk

NEW YORK/LONDON, May 18 (Reuters) - Major stock indexes

mostly eased as technology shares fell on Monday, while Brent

oil prices climbed to a two-week high as investors assessed

whether there will likely be progress soon to end the Iran war.

Longer-dated U.S. Treasury yields were nearly flat after

climbing to their highest level in over a year in overnight

trading.

Sovereign bond yields have risen sharply recently as investors

worry the war in Iran that began in late February may bring a

lasting inflationary shock. Energy costs, they fear, will feed

through to consumer price inflation and lead to a U.S. Federal

Reserve rate hike.

U.S. President Donald Trump said on Monday he had paused a

planned attack against Iran to allow for negotiations to take

place on a deal to end the war, after Iran sent a new peace

proposal to Washington.

Oil prices rose as investors digested the latest developments.

U.S. crude added $3.24 to settle at $108.66 a barrel.

Brent crude gained $2.84 to $112.10 - its highest close

since May 4.

PROFIT-TAKING IN TECH SHARES

Market watchers said investors may be taking profits in tech

shares, which have had a strong run recently. Also, they are

bracing for quarterly results from Nvidia ( NVDA ) on Wednesday.

Technology, down 1%, led sector declines in the

S&P 500, while an index of semiconductors was down 2.5%.

Energy led sector gainers and was last up 1.8%.

"The semiconductors particularly got beaten up a little, and

they've had a huge, huge run," said Bruce Zaro, managing

director at Granite Wealth Management in Plymouth,

Massachusetts.

The recent rise in interest rates adds to investors'

worries, he said, noting that "there is this assumption that

rising interest rates are bad for technology stocks. I would

debate that in many ways."

In addition, strategists noted that Trump's first visit to

Beijing since 2017 ended on Friday with no major breakthroughs

on trade or tangible help from Beijing to end the U.S.-Israeli

war with Iran.

The Dow Jones Industrial Average rose 159.95 points,

or 0.32%, to 49,686.12, the S&P 500 fell 5.45 points, or

0.07%, to 7,403.05 and the Nasdaq Composite fell 134.41

points, or 0.51%, to 26,090.73.

MSCI's gauge of stocks across the globe fell

0.77 points, or 0.07%, to 1,098.23.

The pan-European STOXX 600 index rose 0.54%.

Rising yields push up borrowing costs and mean a higher

discount for future company earnings, challenging stock

valuations.

The yield on the benchmark 10-year Treasury note

climbed to 4.659% in overnight trading, its highest level since

February 2025. It has since retraced its gains and was last

nearly flat on the day at 4.591%.

Earlier, Japan's 10-year yield hit a peak not seen since 1996 as

the government proposed to issue fresh debt to fund a planned

extra budget to cushion the economic blow from the Iran war.

Germany's 10-year bond yield rose to a level not

seen in 15 years.

AI, RETAIL EARNINGS TO TEST STOCKS' RECENT RALLY

The artificial intelligence trade will be tested by earnings

results from Nvidia ( NVDA ) due on Wednesday, with expectations high for

the world's most valuable company.

Nvidia ( NVDA ) shares ended the day 1.3% lower. They are, however,

up sharply since a March low, while the Philadelphia SE

semiconductor index has also surged amid demand for chips as

tech companies spend massively to build AI-related

infrastructure.

A U.S. jury on Monday ruled against Elon Musk in his lawsuit

against OpenAI, finding the AI company not liable to the world's

richest person for having allegedly strayed from its original

mission to benefit humanity.

Also due this week are results from a host of retailers,

including Walmart ( WMT ), which will provide insight into how

consumers are faring with high energy prices.

The dollar slipped against most major currencies as U.S.

Treasury yields were off recent high levels.

The dollar index, which measures the greenback

against a basket of currencies including the yen and the euro,

fell 0.33% to 99.03.

Spot gold rose 0.61% to $4,565.54 an ounce.