The Dow plummeted more than 500 points Friday as financial and tech stocks were hit hard by a handful of persistent investor worries.
The blue-chip Dow slumped 1%, to 48,977.922. For the week, the index was down 1.3%, its biggest weekly drop since November.
The S&P 500 lost 0.4%, and the Nasdaq dropped or 0.9%. The tech-heavy Nasdaq slid 3.4% for the month, it biggest decline since March 2025.
“To wrap up the month of February, we were reminded there are still some cracks out there,” said Ryan Detrick, chief market strategist at Carson Group in Omaha, Nebraska. “Adding to the day’s weakness was the hotter inflation data, potentially pushing back on the idea of a dovish Fed later this year.”
“It’s been a rough go in February, but corporate America is looking at over a 14% gain in earnings in the fourth quarter,” Detrick added. “The reality is that earnings drive long-term stock gains and this was a very impressive earnings season.”
Financial stocks slid after worries of contagion in the sector after reports that Barclays, Jefferies JEF.N, Wells Fargo and other banks face potential losses related to the collapse of UK mortgage provider Market Financial Solutions Ltd., amid broader concerns about lending standards. Wells Fargo, Jefferies and US-listed shares of Barclays ended sharply lower.
“This is a classic risk-off environment where the pure defensive areas are finding some strength while the market is turning its head on some of the more cyclical growth areas that are clearly lagging,” Detrick said.
On the economics front, a hotter-than-expected Producer Price Index reading fortified expectations that the Federal Reserve is unlikely to cut its key interest rate in the near term.
Financial markets are currently pricing in a 96.1% probability that the central bank will leave the Fed funds target rate in the 3.50% to 3.75% range at its upcoming monetary policy meeting in March, according to CME’s FedWatch tool.
Nvidia slid 4.2%, extending the previous session’s 5.5% drop despite solid earnings, a sign that risk sentiment for all things AI remained shaky.
Zscaler plunged 12% after the cloud security firm reported a wider net loss in the second quarter.
Netflix added 14% as investors cheered its decision to exit the fight for Warner Bros. Discovery, which dropped 2%. Paramount Skydance rose 21% after winning the race for some of the world’s most prized TV and film assets.
Jack Dorsey’s Block surged 17% after the payments firm said it would cut over 4,000 jobs, nearly half its workforce, as part of an overhaul to embed AI across operations.
Dell climbed 22% after the PC-maker said it expects revenue from its key AI-optimized servers business to double in fiscal year 2027 and promised to return more cash to shareholders.
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