US stocks faltered in their rebound bid on Friday, resuming a tech-led sell-off as investors weighed signals on the jobs market and the odds that the AI investment boom will pay off.
The tech-heavy Nasdaq Composite (^IXIC) led the losses, falling around 0.7% in the minutes after the opening bell, following Thursday’s sharp losses for US gauges. The S&P 500 (^GSPC) slid 0.5%, while the Dow Jones Industrial Average (^DJI) lost around 0.4%.
Stocks are on track to close a bumpy week in the red, dragged down by persistent worries about an AI bubble as Big Tech valuations run high. The S&P 500 and the Dow are headed for solid weekly losses. And after sharp slumps for “Magnificent Seven” stalwarts such as Nvidia (NVDA), the Nasdaq Composite is heading for a 2.8% loss for the week — its deepest since April and Trump’s tariff “Liberation Day”.
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In the latest tech extravagance, Tesla (TSLA) approved a $1 trillion pay package for CEO Elon Musk on Thursday, setting high targets for growth in the EV maker’s market value. Musk is also being asked to deliver on his promises for its robotaxi and Optimus humanoid robot — the hardware side of the AI boom. Tesla shares traded slightly lower.
Adding to the downbeat mood, October job cuts hit their highest level for the month in more than 20 years, underscoring what’s shaping up to be the worst year for layoffs since 2009.
That private data out Thursday reverberated through Wall Street more than usual, given the current dearth of official updates on the economy. The Bureau of Labor Statistics was scheduled to release the October jobs report on Friday, but for a second straight month, the data’s publication has been delayed by the government shutdown.
Clues to the health of the economy could come from the University of Michigan’s initial reading of consumer sentiment in November, due Friday morning.
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In the background, investors are watching for several potential upside catalysts: The end of the prolonged US shutdown, a December interest rate cut, and Nvidia’s upcoming earnings report could help stabilize sentiment and revive risk appetite. But the Supreme Court’s review of the legality of President Trump’s tariff policies adds a layer of uncertainty.