Stock market today: the fall in technology stocks takes Wall Street towards the finish line of another losing week

NEW YORK (AP) The worst week for big tech stocks since the COVID crash of 2020 brought Wall Street to the finish line Friday of another losing week.

The S&P 500 fell 0.9% to close its third straight week of decline. It's his longest streak since September, before embarking on an adventure that has sent him on a string of records this year.

The Nasdaq Composite Index fell 2%. The Dow Jones Industrial Average, which places less emphasis on technology, is an outlier and rose 211 points, or 0.6%.

The market's worst performers included several stocks that had been its biggest stars. Super Micro Computer lost more than a fifth of its value, falling 23.1%. The company, which sells servers and storage systems used in AI and other computing systems, has soared nearly 227% for the past year.

Nvidia, another stock that soared to dizzying heights due to Wall Street's frenzy around artificial intelligence technology, also gave up some of its big recent gains. It fell 10% and was by far the heaviest weight in the S&P 500, due to its enormous size.

S&P 500 tech stocks overall lost 7.3% this week, their worst performance since March 2020, as some global giants reported discouraging trends. ASML, a Dutch company that is a major supplier to the semiconductor industry, for example, reported lower than expected orders for the start of 2024.

The biggest threat was the discouraging and dawning realization on Wall Street that interest rates could likely stay high for much longer.

Senior Fed officials said this week that they could keep interest rates high for a certain time. It's a disappointment for traders after the Fed signaled earlier that three interest rate cuts could be possible this year.

High rates hurt the prices of all kinds of investments. Some of the hardest-hit stocks tend to be those considered the most expensive and require investors to wait the longest for strong growth, which can leave tech stocks vulnerable.

A rate cut appeared to be on the horizon after inflation slowed sharply last year. But a series of reports this year showing that inflation remained higher than expected has raised concerns that progress may be stalled.

Fed officials insist they want more evidence that inflation is heading toward their 2% target before lowering the Fed's main interest rate, which is at its highest level since 2001.

Traders now largely expect only one or two rate cuts this year, according to CME Group data, compared with six or more expected at the start of the year. They are also betting on the possibility of no rate cuts this year.

But Brian Jacobsen, chief economist at Annex Wealth Management, expects inflation to moderate as U.S. households, which have become hypersensitive to corporate price hikes, begin to slow their spending.

The giant noise of (escaping) optimism from the market is due to the Fed's lack of foresight and its irrational focus on the development of inflation rather than its direction, he said.

With interest rates unlikely to be much help in the near term, companies are under even greater pressure to generate earnings growth. Recent price declines have somewhat eased criticism that the shares have become too expensive, but they won't look cheap unless prices fall further or earnings rise.

Netflix fell 9.1% despite yielding higher profits for the last quarter than expected. Analysts called the performance strong, but the streaming giant disappointed some investors by saying it would do so. stop giving updates on its subscriber numbers every three months, starting next year.

American Express helped limit market losses, up 6.2%. It announced a profit for the last quarter that was higher than analysts expected. Fifth Third Bancorp rose 5.9% after also beating expectations.

Overall, the S&P 500 lost 43.89 points to 4,967.23. This is 5.5% below its record set at the end of last month.

The Dow Jones Industrial Average rose 211.02 to 37,986.40 and the Nasdaq composite fell 319.49 to 15,282.01.

In the oil market, a barrel of Brent returned to $87.29 after briefly jumping above $90 overnight due to concerns about oil. fighting in the Middle East. Iranian troops fired air defenses on a major air base and nuclear site during a Apparently Israeli drone attack, causing concerns in the market. But crude prices pared gains as traders wondered how Iran would respond.

In the bond market, the yield on 10-year Treasury bills fell to 4.62% from 4.64% Thursday evening, reducing its gain for the week. It had fallen further overnight as concerns grew over a potentially widened war in the Middle East.

In overseas markets, stock indices were mixed in Europe after falling more sharply in Asia.