(Updates with index/price moves, macroeconomic data, and company/geopolitical news from the first paragraph.)
US equity indexes traded mixed as escalating geopolitical tensions and rising energy prices weighed on risk appetite, partially offsetting small gains in technology.
The Dow Jones Industrial Average dropped 1.2% to 52,255.1, and the S&P 500 declined 0.4% to 7,631.2 after midday Friday. The Nasdaq Composite was less than 0.1% higher at 25,988.3.
All but two sectors declined, led by consumer staples. Energy and technology were the only sectors to rise.
Fifteen of the 20 top-performing stocks in a category with a market capitalization exceeding $200 billion each were from technology, according to data compiled by Finviz. This tech outperformance represents a recovery, as Meta Platforms' (META) plans announced Thursday to increase capital expenditure by $5 billion at the bottom end of the range for 2026 and launch a new, non-voting share class to raise funds helped spark a sell-off in the so-called AI trade.
"Investors continued to assess the recent selloff in AI-related stocks, driven by concerns over the sector's substantial capital requirements," D.A. Davidson said in a research note. "Although the pace of the decline in technology stocks moderated, escalating geopolitical tensions and rising energy prices kept risk appetite subdued."
Saudi Aramco has ordered the evacuation of its headquarters in Dhahran on the Gulf near Bahrain, Reuters reported, as fighting intensified with the Iran-aligned Houthis, Reuters reported. Meanwhile, an oil spill from a tanker was detected off the coast of Umm Al Quwain in the United Arab Emirates, the UAE Ministry of Climate Change and Environment said, according to the news report, without identifying the cause of the spill or the tanker involved.
The front-month West Texas Intermediate crude oil contract jumped 3.8% to $103.29 per barrel, and global benchmark Brent advanced 3.1% to $116.62 per barrel.
"Iranian attacks on ships in the Strait of Hormuz, Houthi attacks on the Saudis, Iran's threats to escalate the means of retaliation, and [President Donald] Trump's post about a week ago to 'finish the job' are all contributing to this sentiment," Derek Holt, head of capital market economics at Scotiabank, said in a note.
The rise in crude prices is adding to inflation concerns and reinforcing expectations that interest rates could remain elevated for longer, the D.A. Davidson note said.
US Treasury yields jumped in midday trading. The 10-year yield climbed 3.1 basis points to 4.98%, the 30-year rate advanced 2.4 basis points to 5.31%, and the two-year yield rose 5.1 basis points to 4.67%.
S&P Global's October flash reading of manufacturing conditions rose to 56.0 from 55.9 in September, versus the 55.5 forecast in a Bloomberg-compiled survey, indicating an expansion to a 53-month high.
The final reading in the University of Michigan consumer sentiment index for October stood at 48.0 from the 46.3 preliminary estimate, beating expectations for no revision in a Bloomberg-compiled poll. That print was below the 48.1 final reported in September. Respondents expected a 4.7% inflation rate over the next year and 3.5% annual inflation over the next five years, both up from 4.6% and 3.4%, respectively, in September.
Gold futures fell 1.3% to $4,008.20, and silver futures dropped 1.8% to $54.02.
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