Wall Street’s hottest stocks — from Nvidia to bitcoin-linked companies — dragged markets lower Friday as the S&P 500 headed for its second straight steep loss. The pullback follows warnings that prices had risen too far, too fast amid the AI investment boom.
Major Indexes Decline Again
The S&P 500 fell 1.2% in early trading, adding to one of its worst drops since spring. Even so, the index remains within 3.3% of the record it set just weeks ago. The Dow dropped 582 points, and the Nasdaq slid 1.5%, extending Thursday’s global sell-off.
AI Leaders Lose Altitude
Nvidia, the face of the artificial intelligence frenzy, slipped 2.2%. Despite the drop, it’s still up 36% this year after several years of explosive growth. Investors are now bracing for Nvidia’s earnings report next week, which could swing the broader market given the company’s massive influence on the S&P 500.
Bitcoin and Crypto Stocks Tumble
Bitcoin fell below $96,000, retreating to levels last seen in May after peaking near $125,000 in October. The decline pulled down crypto-related companies: Strategy fell 4%, Coinbase dropped 3.1%, and Robinhood slid 3.6%.
Walmart Drops on CEO Exit
Outside tech and crypto, Walmart shares sank 2.4% after announcing that longtime CEO Doug McMillon will retire in January. McMillon oversaw the retailer’s significant shift into technology and e-commerce.
Interest Rate Uncertainty Adds Pressure
Markets are also grappling with questions about the Federal Reserve’s next steps. Treasury yields have eased this year as the Fed cut rates twice, but doubts are growing about another cut in December. With inflation still above 2% and the recent government shutdown delaying key economic data, some Fed officials say they may need to wait for more clarity.
Global Markets Join the Sell-Off
Overseas markets mirrored the downturn. South Korea’s Kospi plummeted 3.8%, while Germany’s DAX fell 1.8%, underscoring broader worries about high valuations and slowing growth.
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