US stock markets ended Friday on a down note as big tech companies continued their sell-off, dragging major indices lower. The S&P 500 dropped 1.1%, while the Nasdaq composite fell 2.1%, marking their worst week since June. The Dow Jones Industrial Average fared slightly better, losing just 0.3%. Chipmakers led the decline, with Micron Technology shedding 5.6% and Intel losing 5.8% as investors questioned the sustainability of the AI-driven growth spree.
Other tech giants also took a hit, with Meta falling 4.4% and Alphabet down 2.9%. Concerns are growing that these companies, heavily reliant on debt financing for their AI investments, may struggle to maintain their spending as global bond yields climb to multi-year highs. Netflix’s stock fell 3% after announcing leadership changes and plans to cut 6% of its workforce.
Energy stocks bucked the trend, with Exxon rising 2.2% and Chevron gaining 2.4%. Brent crude oil surged 3.7% to $109.86 per barrel, supported by geopolitical tensions in the Middle East. Meanwhile, the 10-year Treasury yield slipped to 5.09%, despite inflation data suggesting further rate hikes may be on the horizon. The Federal Reserve’s next policy meeting in December now has a 74.3% chance of a rate increase, up from 50.2% a month ago.
Tesla shares fell 3.3% after unveiling a new Roadster model with flight capabilities. Alcoa and The Travelers Co. reported better-than-expected earnings, rising 2% and 1.6%, respectively. Analysts expect strong profit growth across sectors during the current earnings season, which has helped US stocks reach record highs despite economic uncertainties.