Wall Street Shifts Direction: Tech-Driven Recovery Leaves Major Indexes Mixed After Volatile Session

Equity markets demonstrated considerable resilience on Friday, as major benchmarks reversed early losses to finish the trading day with modest moves. The tech-focused Nasdaq advanced 30.23 points, representing a 0.1 percent gain to close at 22,900.59, while the S&P 500 edged marginally lower by 3.38 points or 0.1 percent, settling at 6,734.11. The Dow Jones Industrial Average retreated more decisively, declining 309.74 points or 0.7 percent to 47,147.48, having surrendered ground from Wednesday’s record-setting close.

Sector Divergence Shapes Market Direction

Energy emerged as the week’s strongest performer, with crude oil gains propelling the NYSE Arca Oil Index up 2.0 percent and the Philadelphia Oil Service Index climbing 1.7 percent. Technology stocks rebounded from morning weakness, with marquee names including Nvidia, Palantir Technologies, and Tesla all posting gains. Computer hardware and software equities regained considerable ground after their role in Thursday’s selloff.

In contrast, transportation stocks extended their downward trajectory, with the NYSE Arca Airline Index sliding 2.0 percent. Retail equities also struggled, as the Dow Jones U.S. Retail Index fell 1.1 percent, signaling consumer-focused weakness amid broader uncertainty.

Fed Rate Cut Odds Compressed

The session’s muted performance reflected ongoing anxiety surrounding monetary policy. Recent communications from Federal Reserve officials and uncertainty over economic data releases—stemming from potential government shutdown impacts—have substantially diminished expectations for another quarter-point rate reduction at the upcoming Fed meeting. CME Group’s FedWatch Tool now reflects only a 45.9 percent probability of such a cut, a sharp pullback from 66.9 percent just one week prior.

This shift dampened broader buying interest despite the attractive valuations available during the morning’s selloff. Traders remained cautious, awaiting clarity on the Fed’s next move and its implications for both equities and fixed income markets.

Weekly Performance and Global Markets

For the week, the Nasdaq declined 0.5 percent, while the S&P 500 inched up 0.1 percent and the Dow gained 0.3 percent, reflecting the choppy trading environment that characterized recent sessions.

International markets shifted broadly lower during Friday trading. Japan’s Nikkei 225 Index tumbled 1.8 percent, while China’s Shanghai Composite Index declined 1.0 percent. European bourses similarly weakened, with the U.K.'s FTSE 100 sliding 1.1 percent, the French CAC 40 retreating 0.8 percent, and the German DAX falling 0.7 percent.

Bond Market Pressure Intensifies

Treasury securities came under selling pressure as the session progressed, reversing earlier strength. The benchmark ten-year note yield shifted higher by 3.6 basis points to 4.148 percent after touching a session low of 4.065 percent, reflecting reduced demand for safe-haven assets amid modest equity recovery.