US stocks today: S&P 500, Nasdaq slides as chip stocks fall, jobs data fuels hawkish Fed fears

Wall Street's major indexes fell on Friday, as chipmakers ​lost steam following a sharp rally, while a stronger-than-expected monthly jobs report raised expectations of a hawkish monetary policy.

Nonfarm payrolls rose by 172,000 jobs in May after increasing 115,000 in April. The numbers were also much higher than the 85,000 forecast by a Reuters survey of economists.

Money markets now see a 98% chance ‌that the U.S. ⁠Federal Reserve will ⁠hike interest rates by 25 basis points before the end of the year, up from a nearly 60% expectation before the data.


The data comes ahead of new Fed ​Chair Kevin Warsh's first policy meeting later this month, as he takes charge of an economy grappling with elevated inflation, partly exacerbated by the Middle East ​conflict.

"You're not talking about a labor market that's doing fabulous, but you're also not looking at a labor market that's completely crumbling," said Mark Malek, chief investment officer at Siebert Financial.

"It's healthy for the market to pull back a little bit and slow down."

Nvidia, the largest ​company by market value, lost 2.5%, while Intel, Micron, AMD and Broadcom dropped between 4.2% ⁠and 6.2%.

Tech ‌shares declined for a third straight session, falling 2.5%. The Philadelphia SE Semiconductor index tumbled over 5%.

Gains in semiconductor ​stocks were instrumental ​in Wall Street's recovery from March lows to record highs. A temporary ceasefire in the Middle East and ⁠strong earnings growth also supported the advances.

Six of 11 major S&P 500 indexes moved ​higher, with consumer staples leading the gains, as investors rotated money into other sectors.

At 09:43 a.m. ​ET, the Dow Jones Industrial Average fell 128.36 points, or 0.25%, to 51,433.57, the S&P 500 lost 64.63 points, or 0.85%, to 7,519.68 and the Nasdaq Composite lost 374.02 points, or 1.39%, to 26,456.94.

If current losses hold, the S&P 500 would register its first weekly decline since April. The tech-heavy Nasdaq was also set to end the week slightly lower, while the price-weighted Dow was on track to rise for a third straight week.

Talks between the U.S. and Iran remained stalled heading into the weekend, underscoring complications facing a peace deal to end ‌the conflict.

Citi said it was trimming equity exposure after a strong run, flagging rising inflation and positioning risks. It kept a constructive longer-term view on U.S. equities supported by AI-driven earnings.

Among market movers, Lululemon Athletica slumped 8% after ​the athletic apparel ​maker cut its annual profit forecast and ⁠projected second-quarter earnings well below Wall Street estimates.

Cooper Companies rose 6.4% after the maker of contact lenses beat estimates for second-quarter results.

S&P Global said it would not change the eligibility requirements for its major indices, which effectively rules out a swift entry for Elon Musk's SpaceX ​to the benchmark S&P 500 after it goes public in what would be the world's biggest IPO.

Meanwhile, S&P Dow Jones Indices will announce the results following its rebalancing after markets close. Chipmaker Marvell Technology, which now boasts over $270 billion in valuation, is among the contenders to be added to the benchmark index.

Declining issues outnumbered advancers by a 2.04-to-1 ratio on the NYSE, and by a 2.11-to-1 ratio on the Nasdaq.

The S&P 500 posted 7 new 52-week highs and 2 new lows, while the Nasdaq Composite recorded 27 new highs and 38 new lows.