US stocks fell on Friday as worries over a global IT outage calmed, with Wall Street looking for recovery from a sell-off that saw the Dow snap a run of wins and a tech rout continue.
The Dow Jones Industrial Average (^DJI) slipped roughly 1%, coming off a drop of over 1% for the blue-chip index. The S&P 500 (^GSPC) fell 0.7%, while the tech-heavy Nasdaq Composite (^IXIC) declined 0.8%.
Stocks are facing weekly losses after a wobbly handful of sessions that saw a dive in techs, with AI-focused chip stocks bearing the brunt. Investors are rotating out of the tech heavyweights that have fueled the recent rally and into small caps, seen by some as benefiting more from interest-rate cuts.
In the early hours, investors assessed the potential impact of an “unprecedented” failure in computer systems worldwide that grounded flights and hit banks, telecoms and media companies, among others. But concerns eased after CrowdStrike (CRWD) said a fix was in place for the glitch, a botched update that affected Microsoft-based (MSFT) systems.
CrowdStrike shares plunged as much as 20% as the outage spread, but pared losses to around 10% by afternoon trading. Shares in Microsoft — which was working on problems with its Azure cloud services — were down less than 1%.
Meanwhile, Republican presidential contender Donald Trump used his nomination speech on Thursday to say he would “end the electric vehicle mandate on day one.” His comment comes as the market wakes up to the “Trump trade” — the implications of his policies for assets if the former president takes the White House.
Shares of Tesla (TSLA) and other EV makers fell on Friday, along with the broader market.
Chip stocks slipped again on Friday, set to end the week with heavy losses. Nvidia (NVDA) dropped more than 2% during the session, while chip equipment maker ASML (ASML) also declined, on track to tally a decline of 17% over the past five sessions.
The Nasdaq 100 (^NDX) sank to a session low, down roughly 1% on Friday, with EV manufacturer Tesla (TSLA) dropping more than 4% and chipmaker Nvidia (NVDA) sinking more than 2%.
Electric vehicle stocks were under pressure on Friday after former President Donald Trump criticized the Biden administration’s clean energy initiatives, referring to them as the “green new scam” during the Republican Convention. Trump’s comments led to a drop in shares of Tesla (TSLA), Rivian (RIVN), and Lucid (LCID).
Almost all the S&P 500 sectors fell on Friday, with Technology (XLK) and Consumer Discretionary (XLY) stocks leading the declines. The Materials Sector (XLB) was also down by 1%, while Healthcare (XLV) was the only sector slightly higher.
Netflix (NFLX) shares jumped at the open after posting better-than-expected quarterly results, but later gave up those gains. CrowdStrike (CRWD) shares fell 10% following the global IT outage, but CEO George Kurtz said a fix was in place for the glitch.
Stocks were little changed on Friday as more details emerged about the global IT outage, with the Dow Jones Industrial Average (^DJI) slipping 0.2% and the S&P 500 (^GSPC) hovering around the flatline. The tech-heavy Nasdaq Composite (^IXIC) slipped 0.2%.
In other news, American Express (AXP) CEO Stephen Squeri announced a hike in the company’s marketing budget, while Netflix earnings and guidance were also discussed by analysts.
