U.S. Stocks Extend Weekly Losses as Tech Concerns and Shutdown Pressure Markets
U.S. stocks declined on Friday, deepening weekly losses as investors grew wary of high tech valuations and the ongoing government shutdown continued to cloud economic and policy outlooks.
At 09:35 ET (14:35 GMT), the Dow Jones Industrial Average fell by 225 points (0.5%), the S&P 500 dropped 40 points (0.6%), and the NASDAQ Composite slid 200 points (0.9%). All three major U.S. indices are heading for weekly declines, pressured by concerns over the sustainability of elevated tech valuations. Before Friday’s session, the S&P 500 was down 1.8% week-to-date, while the Dow Jones lost 1.4% and the Nasdaq fell nearly 2.8%.
Shutdown Complicates Fed Policy Outlook
The prolonged U.S. government shutdown, now stretching into its second month, has disrupted key economic data releases, including inflation and employment reports. This data blackout has left investors and Federal Reserve policymakers navigating without a full picture of the economy, making it harder to gauge whether further rate cuts are warranted.
Private-sector data helped fill some gaps this week. Challenger, Gray & Christmas reported that U.S. companies announced 183% more job cuts in October than in September — the largest monthly surge in decades. Meanwhile, the Bank of America Institute noted that although the labor market hasn’t slowed drastically, it has cooled noticeably since spring.
Additionally, ADP payroll data showed that private U.S. firms added 42,000 jobs in October, rebounding from a revised 29,000-job loss in September.
According to Morgan Stanley analysts Michael Gapen and Sam Coffin, the limited but available data keeps a December Fed rate cut “more likely than not.” The Federal Reserve reduced rates by 25 basis points in October, aiming to stabilize the job market. However, Fed Chair Jerome Powell has cautioned that another rate cut this year is not guaranteed amid inflation concerns.
Adding to uncertainty, the U.S. Supreme Court expressed skepticism about the legality of President Donald Trump’s tariffs, raising doubts about the future of his trade policies.
Earnings Season Offers Partial Support
Despite market pressure, corporate earnings have provided some relief. Of the 424 companies in the S&P 500 that have reported third-quarter results, 83% have exceeded Wall Street expectations.
- Airbnb (NASDAQ: ABNB) shares climbed after forecasting strong quarterly revenue, supported by robust bookings in Latin America and Asia-Pacific.
- Affirm Holdings (NASDAQ: AFRM) surged after reporting better-than-expected first-quarter results and raising its full-year outlook.
- Take-Two Interactive (NASDAQ: TTWO) fell as Rockstar Games delayed the release of Grand Theft Auto VI to November 2026.
- DraftKings (NASDAQ: DKNG) dropped after lowering its full-year sales guidance, citing competition from prediction market platforms.
- Peloton (NASDAQ: PTON) gained after beating revenue estimates, driven by new product launches and price adjustments.
In a major corporate development, Tesla (NASDAQ: TSLA) shareholders approved a historic $1 trillion compensation package for CEO Elon Musk during the company’s annual meeting in Austin, Texas. The plan is tied to ambitious performance goals, including reaching an $8.5 trillion valuation and deploying robotaxis and humanoid robots.
Oil Prices Edge Higher But Face Weekly Decline
Oil prices rose on Friday, but both major benchmarks are set for their second consecutive weekly loss amid oversupply concerns and signs of slowing U.S. demand.
Brent crude gained 0.9% to $63.92 per barrel, while West Texas Intermediate (WTI) rose 0.9% to $60.00 per barrel. Both are down roughly 2% for the week, pressured by OPEC+’s decision to slightly increase output in December while pausing additional hikes in early 2026 to avoid a potential glut.
Adding to headwinds, U.S. crude inventories rose more than expected, amplifying concerns over demand weakness as the historic government shutdown continues.
