U.S. stocks retreated on Friday as a market-wide sell-off spread beyond technology shares into defensive sectors, while crude oil prices climbed past $100 a barrel amid escalating geopolitical tensions involving the United States and Iran.
The Dow Jones Industrial Average dropped 652.82 points, or 1.23%, to settle at 52,215.16. The broader S&P 500 slipped 0.52% to 7,623.68, and the tech-heavy Nasdaq Composite lost 0.21% to close at 25,955.34. Across the trading week, the S&P 500 declined 0.5% and the Nasdaq shed 0.7%, while the Dow managed a weekly gain of 0.4%.
Friday’s session saw defensive equities come under heavy pressure. Consumer staples, utilities, and healthcare sectors all finished lower. Corporate announcements also weighed on the blue-chip index; American Express shares fell more than 3% after the company announced plans to cut approximately 5% of its global workforce to prepare for artificial intelligence integration. Additional downward pressure on the 30-stock index came from Caterpillar, which edged down about 2%, and Goldman Sachs, which lost more than 1%.
The broader market retreat followed a Thursday pullback in technology stocks as traders evaluated the financial impact of extensive corporate borrowing and rising interest rates on artificial intelligence infrastructure. Despite the ongoing sector rotation, some parts of the tech space rebounded on Friday. Microsoft ticked higher, while chipmakers Micron Technology and Advanced Micro Devices posted stronger gains of nearly 3% and almost 2%, respectively.
Jed Ellerbroek, portfolio manager at Argent Capital Management, noted that the market shift reflected fatigue among investors rotating out of technology and data center beneficiaries into defensive assets. Ellerbroek pointed out that strong quarterly earnings reports from technology firms have provided fundamental support, helping offset emotion-driven market movements. He added that emotion and fear play significant roles, but solid financial results have encouraged investors to refocus on company fundamentals.
Bond yields edged higher as investors monitored debt issuance related to artificial intelligence data centers. The 10-year Treasury yield hovered around 4.999%, rising more than 4 basis points on the day after dipping below the key 5% threshold on Thursday for the first time in a month.
Meanwhile, surging energy markets compounded the downward pressure on equities. West Texas Intermediate futures rose 3.8% to settle at $103.27 per barrel, while Brent crude climbed 3.1% to end the session at $116.72 per barrel, marking its highest settlement since April. The sharp increase in oil prices followed reports that the United States and Israel may be developing plans for renewed military actions against Iran as part of the ongoing regional conflict that began in late February. Iranian officials have stated that the nation is prepared to retaliate against any strikes.
