Finance

The tech-heavy Nasdaq Composite plunged 4.2% on Friday, marking its sharpest weekly decline since April 2025. The sell-off was led by high-profile semiconductor and artificial intelligence firms, with the sector coming under renewed scrutiny despite strong recent earnings. This volatility snapped a nine-week winning streak for the S&P 500, which ended the session down 2.6% as risk-off sentiment dominated trading.

Shares of chipmaker Broadcom continued to decline following its latest quarterly results, where the company failed to raise its long-term revenue guidance for artificial intelligence. Although the firm's earnings technically beat analyst estimates, its decision to merely reiterate existing 2027 forecasts frustrated a market accustomed to frequent upward revisions. This tempered enthusiasm spread across the semiconductor index, contributing to substantial losses for other major players like Nvidia and Micron.

Market expectations for a June interest rate cut have largely evaporated, with predictive markets now showing nearly a 99% probability of no change. Persistent inflation, currently at 3.8%, and the strength of the labor market have shifted the internal consensus among policymakers toward a 'higher-for-longer' stance. Analysts suggest that the potential for further rate hikes remains on the table if supply-side energy shocks continue to impact core consumer prices.