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Stocks End Second Straight Week Lower as Chip Shares Slide

U.S. stock markets finished the week on a mixed note Friday, but all three major indexes ended lower for the second consecutive week as weakness in semiconductor stocks, rising interest-rate expectations, and trade uncertainty continued to weigh on investor sentiment. While the Dow Jones Industrial Average managed to post modest gains, technology shares remained under pressure, dragging the Nasdaq lower.

Nasdaq Leads Weekly Decline

The Nasdaq Composite fell 0.6% on Friday, extending its weekly loss to 2.1%. The S&P 500 slipped 0.1% during the session and finished the week down 0.6%, while the Dow Jones Industrial Average gained 0.5% on Friday but still recorded a weekly decline of 0.4%.

Technology stocks remained the weakest segment of the market as investors continued reassessing artificial intelligence-related investments and semiconductor valuations.

Chip Stocks Continue to Weigh on Markets

Semiconductor shares experienced another difficult session, adding pressure to the broader technology sector.

The Roundhill Memory ETF dropped 8.5%, led by sharp declines in memory-chip makers. Sandisk fell approximately 11%, while Micron Technology lost around 7%. The broader iShares Semiconductor ETF also declined roughly 4.5%, reflecting continued concerns over slowing momentum in the chip industry after months of strong gains.

Intel also reversed early optimism despite reporting stronger-than-expected quarterly earnings, with its shares finishing about 8% lower.

Oil Retreats but Posts Strong Weekly Gains

Energy markets cooled on Friday after reports suggested Pakistan, with support from China, is encouraging renewed peace discussions between the United States and Iran.

Brent crude settled at approximately $96.78 per barrel, falling nearly 4% during the session, while West Texas Intermediate (WTI) crude declined to around $89.31. Despite Friday's pullback, both benchmarks still posted strong weekly gains of roughly 10% and 8%, respectively, highlighting continued concerns over global energy supplies.

Rate Hike Expectations Continue to Rise

Treasury yields eased slightly after reaching multi-month highs earlier in the week, but investors continue to expect tighter monetary policy.

The U.S. 10-year Treasury yield closed near 4.68%, slightly below Thursday's peak of almost 4.72%, its highest level since January 2025.

Market expectations for additional Federal Reserve tightening also increased. Traders now estimate roughly a 36% chance of a rate hike at next week's Federal Reserve meeting and about an 80% probability of another increase at the September meeting.

Higher borrowing costs typically reduce demand for risk assets by making fixed-income investments more attractive while increasing financing costs for businesses and consumers.

Corporate Earnings Deliver Mixed Results

Corporate earnings remained another major focus for investors.

Tesla shares extended Thursday's sharp decline, losing another 2% after disappointing earnings and concerns surrounding spending and profitability.

Alphabet recovered slightly with a modest gain after suffering a steep sell-off in the previous session, while Intel erased early gains despite reporting earnings that exceeded analyst expectations.

Elsewhere, Tenet Healthcare surged approximately 17% following strong quarterly results. Verizon Communications gained around 6% after reporting earnings, while American Express declined more than 4% despite posting results before the opening bell.

New U.S. Tariffs Add to Market Uncertainty

Investors also reacted to a fresh round of U.S. tariffs that officially took effect Friday.

The new measures impose tariffs ranging from 10% to 12.5% on imports from more than 60 trading partners, replacing the previous global tariff structure. The policy adds another layer of uncertainty for global trade as markets continue evaluating its potential impact on inflation, corporate earnings, and international supply chains.

Bitcoin Holds Above $64K

The cryptocurrency market remained relatively stable despite weakness in equities.

Bitcoin traded near $64,200, holding above key support levels even as traditional markets experienced increased volatility. Gold edged slightly higher to around $4,055 per ounce, while the U.S. Dollar Index remained largely unchanged, reflecting a cautious stance among investors.

Looking Ahead

Investors will continue watching several major developments next week, including the Federal Reserve's policy meeting, additional corporate earnings, inflation-related data, and geopolitical developments in the Middle East. Together, these factors are expected to play a key role in determining market direction as both traditional financial markets and cryptocurrencies navigate a period of heightened uncertainty.

Disclaimer: This article is for informational purposes only and should not be considered financial or investment advice. Financial markets are subject to rapid changes and volatility. Always conduct your own research and carefully assess your financial situation before making any investment decisions.