NEW YORK — A sharp selloff in semiconductor stocks erased more than $1 trillion in market value Friday, ending Wall Street’s nine-week winning streak with the worst single-day losses in months and leaving investors cautious heading into a week packed with potential market-moving events.
The Nasdaq Composite suffered its worst session since April 2025, plunging 4.18 percent to close at 25,709, while the S&P 500 dropped 2.64 percent to 7,383. The Dow Jones Industrial Average fell 695 points, or 1.35 percent, to 50,867. For the week, the S&P 500 finished down 2.59 percent, the Nasdaq lost 4.68 percent, and the Dow declined 0.32 percent.
The selloff was triggered by a disappointing AI chip outlook from Broadcom, which left its full-year artificial intelligence revenue targets unchanged despite investor expectations for an upgrade. Broadcom shares fell more than 7 percent Friday following a double-digit decline Thursday. The weakness spread across the semiconductor sector, with Marvell Technology plunging roughly 16 percent, Micron Technology dropping about 13 percent, and both Intel and Advanced Micro Devices losing around 11 percent. Nvidia fell nearly 6 percent and Cisco dropped more than 6 percent.
The week had started on a far more optimistic note. The S&P 500 closed above 7,600 for the first time Monday and set another record Tuesday, driven by AI enthusiasm and strong earnings from Hewlett Packard Enterprise. Marvell had surged 25 percent earlier in the week after Nvidia CEO Jensen Huang called it a potential trillion-dollar company. The late-week reversal underscored how quickly sentiment in AI-related stocks can shift on earnings guidance.
U.S.-Iran tensions and rising oil prices added to investor unease mid-week, with West Texas Intermediate crude topping $96 per barrel Wednesday before easing. The conflict also contributed to concerns about inflation remaining elevated heading into the Federal Reserve’s June 16-17 meeting — the first chaired by new Fed Chair Kevin Warsh.
A stronger-than-expected May jobs report, showing 172,000 new nonfarm payrolls against a consensus estimate of 80,000, provided a mixed signal for markets. Economists attributed part of the outsized gain to hiring tied to the FIFA World Cup, set to begin in the United States on June 11. The strong jobs number raised concerns about the Fed’s path on interest rates, with markets now pricing in a higher probability of a rate hike before year end.
Investors are watching closely next week as the SpaceX initial public offering is expected to launch Thursday, Apple’s Worldwide Developers Conference begins, and key inflation data including the May Consumer Price Index and Producer Price Index are set for release.
By: Digital News Updates Newswire