Wall Street struggled Friday after a steep selloff on Thursday erased nearly $800 billion from major tech stocks. The Dow inched up 0.3%, the S&P 500 barely moved, and the Nasdaq slipped 0.4%, weighed down by ongoing pressure in tech shares. Investors faced a complex mix: fresh tariffs, rising AI expenses, and climbing oil prices.
The sharp tech downturn stemmed from earnings announcements by Alphabet and Tesla, both revealing soaring artificial intelligence spending. The market reacted negatively to the jump in costs, amplifying the selloff among high-profile tech giants known as the “Magnificent Seven.” Their combined market value dropped dramatically in a single day, dragging the indices lower.
New Tariffs and Market Reactions
President Trump’s latest Section 301 tariffs took effect overnight, imposing levies between 10% and 12.5% on most US imports from key trading partners. The White House claims this tariff structure was designed to withstand legal challenges better than earlier versions. Energy products were mostly exempted to avoid putting further pressure on inflation, especially as oil prices were already surging and threatening economic progress.
Brent crude futures slipped 2.8% to trade just under $98 a barrel on Friday, but the benchmark still closed the week higher after briefly hitting $100 earlier. This volatility comes amid concerns over inflation and supply constraints.
On the earnings front, Verizon Communications and American Express topped profit estimates but missed revenue targets, leading to share declines. NextEra Energy also beat earnings but fell short on revenue, though its stock gained ground. Intel bucked the trend with a strong earnings report that lifted its shares early Friday, standing out as a rare bright spot in a tough week for tech.
The broader market showed mixed signals. The equal-weight S&P 500 ETF, which balances all stocks equally, rose 0.5%, indicating that the wider market held up better than the tech-driven indices. However, the semiconductor sector took a hit, with the iShares Semiconductor ETF dropping 4.3%, limiting the overall market’s recovery. Consumer discretionary and technology sectors remained the only major groups trading lower.
Investors are now closely watching economic indicators and earnings reports for cues on how tariffs, AI spending, and energy prices will shape the market going forward.
Intel’s earnings beat has offered some relief in a week dominated by uncertainty around tech valuations and costs.
This material is for informational purposes only and is not financial advice.
