On Friday, the three major U.S. stock indices closed lower, with selling pressure spreading from AI-related trades to broader sectors. Oil prices rose as the market grew increasingly concerned about a renewed U.S.-Iran conflict. The 10-year Treasury yield climbed but remained below the 5% threshold.
The Dow Jones Industrial Average fell 652.82 points, or 1.23%, to 52,215.16, posting a weekly gain of 0.41%. The S&P 500 dropped 39.75 points, or 0.52%, to 7,623.68, down 0.47% for the week. The Nasdaq Composite declined 53.51 points, or 0.21%, to 25,955.34, falling 0.71% over the week.
Most popular tech stocks declined, with Alphabet (GOOG) dropping over 1%, while Amazon (AMZN) and Meta (META) each fell nearly 1%. SpaceX rose more than 1%. The memory chip sector advanced, with SK Hynix gaining over 4% and Micron Technology (MU) rising more than 2%.
The oil and gas sector surged, with Chevron (CVX), Exxon Mobil (XOM), and Shell (SHEL) all climbing over 2%. More defensive stocks came under pressure, with consumer staples, utilities, and healthcare sectors all declining. Among Dow components, American Express (AXP) dropped more than 3% after announcing it would cut roughly 5% of its global workforce, saying it needs to "prepare for AI." Caterpillar (CAT) also fell about 2%, and Goldman Sachs (GS) declined more than 1%, further weighing on the Dow.
"For the past two weeks, investors have been pulling out of tech stocks and data center beneficiaries, moving into safe assets, and eventually, the people willing to sprint that way will run out, and today looks and feels like that," said Jed Ellerbroek, portfolio manager at Argent Capital Management.
Ellerbroek added that earnings from tech companies this quarter have proven strong, giving investors reason to embrace tech stocks and reduce sentiment-driven safe-haven behavior.
The 10-year Treasury yield stood at approximately 4.999%, up more than 4 basis points on the day. The benchmark yield had fallen below the critical 5% level on Thursday for the first time in a month, as investors grew cautious about massive borrowing to finance AI data center construction.
Rising oil prices further pressured equities. On the New York Mercantile Exchange, light crude futures for December delivery rose $3.80, or 3.82%, to settle at $103.27 per barrel. London Brent crude futures for December delivery gained $3.55, or 3.14%, to settle at $116.72 per barrel. The moves followed reports that the U.S. and Israel may be planning another strike on Iran as part of a regional war that began in late February. Iran responded by saying it is also prepared to counterattack.
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