US equities finished higher on Friday, with technology shares recovering from a midweek selloff that had been triggered by concerns over artificial intelligence valuations. The advance came despite elevated Treasury yields, choppy oil prices and lingering questions about the durability of the AI trade.
The Dow Jones Industrial Average climbed 423 points, or 0.8%, to settle at 51,661.54. The S&P 500 added 0.6% to close at 7,811.71, while the Nasdaq Composite rose 0.64% to 27,365.00. All three benchmarks posted weekly gains, with the S&P 500 up roughly 1% over the five sessions.
Tech shares recover after AI-related pullback
Software and technology names led Friday's rebound after the Nasdaq dropped more than 1% on Thursday, its steepest single-day decline since mid-August. The prior session's weakness followed reports that OpenAI had told investors its annualised revenue reached $50 billion at the end of September, a figure that differed from an earlier reported $68 billion because the larger number included gross revenue from partners, according to a person familiar with the matter.
Among individual movers, Palo Alto Networks gained nearly 5%, CrowdStrike rose 4% and Palantir Technologies advanced 3%. Microsoft and Amazon each added around 2%. AI-linked companies have powered much of the US bull market, which is approaching its fourth anniversary, though worries about stretched valuations and the debt and equity financing underpinning AI infrastructure have fuelled periodic bouts of volatility.
Investors are now turning their attention to third-quarter earnings season, which could offer clearer evidence on whether AI demand is converting into stronger corporate revenue and profits.
SpaceX spectrum deal pressures telecom operators
SpaceX shares rose after the company unveiled an agreement to acquire a nationwide low-band spectrum portfolio, deepening its push into wireless communications and raising the competitive stakes for incumbent US carriers. The news weighed heavily on AT&T, Verizon and T-Mobile, all of which closed sharply lower as investors assessed how the move might reshape competition in the wireless market.
Healthcare stocks also provided support for the broader market. Humana surged after US government data showed that 95% of its members were enrolled in Medicare Advantage plans rated four stars or higher for 2027. Merck and Gilead Sciences each gained nearly 3%, while Moderna advanced on optimism surrounding reported US National Institutes of Health cancer vaccine efforts.
Apple shares declined following a Nikkei Asia report that the company had asked some suppliers to cut component orders for its newly launched iPhone 18 Pro and iPhone 18 Pro Max. The reported reductions come as rising memory costs and higher device prices stoke concerns about consumer demand. Delta Air Lines also fell after trimming its annual profit forecast, citing fuel costs that were outpacing gains from fares.
Oil, yields and the earnings outlook
Oil prices remained volatile as investors weighed developments in the Middle East. Brent crude and West Texas Intermediate futures each settled about 0.4% higher on Friday, recovering from an initial retreat after President Donald Trump said the US would not attack Iran before the midterm elections. Long-dated Treasury yields edged up but stayed below the 24-year highs touched earlier in the week, with elevated borrowing costs and inflation uncertainty continuing to shape sentiment.
Next week brings quarterly results from major US banks including JPMorgan Chase, Wells Fargo, Citigroup, Goldman Sachs and Bank of America, along with Johnson & Johnson and UnitedHealth. Analysts expect aggregate third-quarter earnings growth of 30.6% for S&P 500 companies, according to LSEG data, with energy and technology among the sectors forecast to post the strongest year-over-year gains.
Investors will also watch upcoming inflation data for signals on the Federal Reserve's next policy move, while oil market developments and AI-related spending remain key risks for equities.
This article is for informational purposes only and does not constitute financial advice.
