- US stocks fell Friday amid tech sell-off and rising oil prices above $100 per barrel
- Dow dropped 559 points, S&P 500 declined 0.42%, Nasdaq-100 slipped 0.28%
- Oil surged on US-Iran conflict fears, with WTI at $100.90 and Brent at $114 per barrel
US stocks fell on Friday as investors remained cautious following a technology-led sell-off and crude oil prices climbed above $100 per barrel, amid fears that the US-Iran conflict could escalate again.
The Dow Jones Industrial Average fell 559.02 points, or 1.06%, while the S&P 500 declined 0.42%. The Nasdaq-100 slipped 0.28%, with technology stocks remaining under pressure after concerns over corporate borrowing and rising interest rates weighed on the sector.
Microsoft and Meta shares were slightly lower in early trading. Investors have been reassessing the scale of borrowing by technology companies to finance artificial intelligence infrastructure and the potential impact of higher financing costs on future returns.
Oil prices climbed on Friday, adding to concerns about inflation and the potential impact of higher energy costs on the US economy. West Texas Intermediate crude futures rose 1.4% to $100.90 per barrel, while Brent crude gained 0.75% to $114 per barrel. The gains followed reports that the US and Israel may be drawing up plans for renewed attacks on Iran as part of the regional conflict that began in late February.
The possibility of further escalation has kept energy markets on edge, with investors assessing the risks to crude supplies and shipping routes. Sustained increases in oil prices can raise fuel and transportation costs, add to inflationary pressures and complicate the outlook for interest rates.
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Technology shares remained under pressure after Thursday's sell-off, as investors examined the risks associated with heavy corporate borrowing to fund AI infrastructure and other technology investments. CoreWeave, which has become a prominent example of data centre companies relying on substantial borrowing to expand capacity, fell 10% on Thursday. Its shares slipped another 1% in early trading on Friday.
The sell-off reflects growing scrutiny of whether spending on AI infrastructure will generate sufficient returns to justify the capital commitments and financing costs involved. Chip stocks showed some signs of stabilisation, with Micron Technology and Advanced Micro Devices gaining around 1% in off-hours trading.
However, the modest recovery in semiconductor shares did little to offset broader concerns about valuations, debt levels and the sustainability of the AI investment cycle.
US Treasury yields were mixed on Friday after falling sharply in the previous session as investors sought the relative safety of government bonds. The yield on the 10-year Treasury note rose one basis point to 4.9697%. The 30-year Treasury yield was little changed, while the two-year yield fell two basis points. The moves followed a decline in yields on Thursday, when demand for government bonds increased amid market uncertainty.
Despite Friday's declines, the major US indices were on track for mixed performances over the week. The S&P 500 was heading for a marginal weekly gain of less than 0.1%, while the Nasdaq Composite was down around 0.5%. The Dow was on course to advance 1.7% over the same period.
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