U.S. equities concluded a volatile week and month on a downbeat note, with major indices finishing in the red on Friday.
$S&P 500(.SPX)$ fell 0.9% in February to close at 6,878.9, slipping below its 50-day moving average. $NASDAQ 100(NDX)$ shed 2.3% for the month, while the $Dow Jones(.DJI)$ finished flat, wiping out its previous rally.
Small-caps followed suit, as $iShares Russell 2000 ETF(IWM)$ erased its monthly gains to close unchanged. Sentiment was weighed down by hotter-than-expected PPI data, which pushed out Fed rate-cut expectations and reignited fears over AI infrastructure disruption.
Technology and financial stocks bore the brunt of the selling today. The information technology sector dropped 1.6%, dragged lower by persistent weakness in software and a 4.2% decline in $NVIDIA(NVDA)$ .
The chipmaker, which had already slid over 5.5% on Thursday despite strong earnings. The financials sector fell 2.0%, led by a 7.4% drop in Goldman Sachs, as the hotter inflation reading undercut the bull case for capital markets activity.
Concerns over AI automation added to the pressure after $Block, Inc.(XYZ)$ announced a 40% workforce reduction, compounding weakness in asset managers already rattled by the collapse of U.K. mortgage firm Market Financial Solutions.
Despite the selling in tech and financials, the market showed notable rotation into defensive and energy sectors again. Health care, consumer staples, and utilities posted gains of 1.8%, 1.3%, and 1.2% respectively. The energy sector surged 1.6% as crude oil futures climbed 2.8% to $67.06 per barrel, though rising fuel costs punished airline stocks like United Airlines and Delta Air Lines.
In the bond market, Treasuries rallied and sent yields to their lowest levels of the year. The 10-year note yield settled down 13 basis points for the week at 3.96%.
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