By ALEX VEIGA AP Business Writer
Stocks closed lower on Wall Street as more drops for big tech companies weighed on the market. The S&P 500 lost 1.1% Friday, and the Nasdaq composite sank 2.1%. Both posted their worst week since June. The Dow Jones Industrial Average didn’t do as badly, and fell 0.3%. Chip companies pulled back some more as worries deepened about how long the frenzy over the AI buildout will last. Micron Technology fell 5.6% and Intel lost 5.8%. European and Asian markets closed higher. The yield on the 10-year Treasury slipped to 5.09%. The price of Brent crude rose 3.7%.
THIS IS A BREAKING NEWS UPDATE. Check back for updates. AP’s earlier story follows below.
Stocks fell on Wall Street Friday as another pullback in big technology companies weighed on the market.
The S&P 500 was down 1.2% as of 3:14 p.m. Eastern time and on track for a weekly loss. The benchmark index pulled further below the all-time high it set last week. The Dow Jones Industrial Average fell 240 points, or 0.5%.
The Nasdaq composite was down 2.2% and headed for its first weekly loss in five weeks. Weakness for AI stocks has been a major drag on the tech-heavy index this week.
Declines in heavyweight tech stocks led the market lower. Micron Technology fell 4.9%, Advanced Micro Devices dropped 5.4%, Broadcom was down 4.1% and Intel lost 5.6%.
Among other tech companies in the red were Meta, which fell 4.4%, and Google parent Alphabet, which gave up 2.9%.
It’s been a choppy week for chipmakers and other big tech stocks central to the artificial intelligence industry. Investors are now worried that the companies, which have relied on debt markets to finance an investment spree into their technology, may not be able to keep borrowing and spending as heavily with yields in bond markets worldwide recently climbing to their highest levels in years.
Netflix’s stock fell 3% a day after the company announced that Chief Content Officer Bela Bajaria will be replaced by Peter Rice. The news comes just days after Netflix said that it plans to lay off about 6% of its workforce, amounting to nearly 1,000 positions.
Energy stocks held up better than most. Exxon rose 2.2% and Chevron added 2.4%.
European and Asian markets closed higher.
In the bond market, Treasury yields held relatively steady. The yield on the 10-year Treasury slipped to 5.09% from 5.10% late Thursday. It had topped 5.30% earlier this month and touched its highest level since 2002 because of worries about high inflation, signals of a strong U.S. economy and other factors.
Yields are down despite reports this week showing that inflation at the consumer and wholesale level rose more in the U.S. than economists expected.
The reports could persuade the inflation-fighters at the Federal Reserve to hike their key interest rate before the end of this year. The central bank increased its key interest rate by a quarter-point to about 3.9% in September, its first increase in three years.
Wall Street traders expect the Fed will keep its short-term rate unchanged at policy meeting this month, but the odds of a rate increase at the December meeting have jumped to 74.3% from 50.2% a month ago, according to data from the CME Group.
On Friday, Federal Reserve Chairman Kevin Warsh offered no fresh signals about potential interest rate policy moves by the Fed while attending a meeting of financial leaders in Bangkok.
Elsewhere in the market, shares in Tesla fell 3.3% after the electric vehicle company unveiled a new model of its Roadster sports car that can thrust itself up in the air.
Alcoa rose 2% and The Travelers Co. gained 1.6% after the companies reported quarterly results that topped Wall Street forecasts.
Expectations are high for growth in profits from all kinds of companies this reporting season, which began in earnest this week. That’s what’s allowed U.S. stocks to set records despite high inflation and the many other worries weighing on Wall Street.
In energy markets, oil prices remained elevated as the global oil supply continues to be under pressure without a deal between the U.S. and Iran to end the Iran war.
Brent crude, the international standard, jumped 3.7% to settle at $109.86 per barrel. That is up from around $72 a barrel in late February before the start of the war. Brent climbed into triple digits last month, the first time since July.
The national average for gasoline is at $4.33 a gallon on Friday, according to AAA. While that’s lower than the $4.37 a gallon that it averaged last month, it’s sharply higher than the $3.06 a gallon from a year ago.
Oil remains well-supported as uncertainties surrounding the situation in the Middle East and concerns over oil flows in the Strait of Hormuz had the market “pricing in a significant risk premium,” ING commodities strategists Warren Patterson and Ewa Manthey wrote in a commentary Friday.