Wall Street saw mixed performance during Friday’s trading session, concluding a week marked by intense selling pressure on technology and artificial intelligence (AI) stocks. The broad-based S&P 500 index eked out a marginal gain of 0.1%, while the Dow Jones Industrial Average rose by 188 points, or 0.4%. In contrast, the tech-heavy Nasdaq Composite fell 0.2%, bringing its weekly loss to 2.4% and dragging the S&P 500 down 0.9% for the week.
The lackluster performance in the tech sector was driven by a decline in semiconductor stocks, fueled by concerns over aggressive technological competition from China. The VanEck Semiconductor ETF (SMH) dropped more than 1% on Friday, bringing its total weekly loss to nearly 9%. This decline was led by major hardware manufacturers—including Micron Technology, Advanced Micro Devices (AMD), and SanDisk—reflecting investor fears that Western chipmakers could face pressure on their profit margins.
Amid the tech downturn, shares of electric vehicle maker Tesla managed a 1% gain following the official announcement of its new-generation roadster model. However, the market's positive reaction was somewhat tempered by the company’s confirmation—under the leadership of Elon Musk—that commercial production of the high-performance vehicle would not begin until 2028, limiting any immediate impact on the company’s cash flow. Market sentiment has also been affected by a reassessment of the AI investment ecosystem, which is heavily concentrated within the private equity market. Jeff Richards, a Managing Partner at Notable Capital, explained that the lack of transparent financial metrics from startups such as OpenAI and Anthropic has fueled uncertainty and concern among institutional investors. He anticipates that market apprehension regarding the AI sector will only subside by 2027, once these companies begin to go public.
Macroeconomic pressures have intensified following a series of "hot" U.S. inflation data; the Producer Price Index (PPI) recorded its largest surge since 2022—driven by a fuel crisis linked to the U.S.-Iran conflict—while the Consumer Price Index (CPI) remained above the 2% target. In his remarks at an IMF meeting in Bangkok, Federal Reserve official Kevin Warsh refrained from confirming any interest rate hikes for the remainder of the year. This cautious signal has led traders in the futures market—as reflected by the CME FedWatch tool—to price in an 85% probability that the Federal Reserve will hold interest rates steady at the upcoming FOMC meeting on October 27–28.
