US stocks saw a decline on Friday as concerns over a global IT outage subsided, with the Dow Jones Industrial Average dropping by approximately 0.9%. The S&P 500 and the Nasdaq Composite also fell by 0.5%. Stock markets faced a tough week due to a sell-off in tech stocks, with AI-focused chip stocks bearing the brunt of the losses. Investors rotated out of tech giants and into small caps, anticipating benefits from interest-rate cuts.
Early on Friday, an “unprecedented” computer system failure impacted various industries, including airlines and banks, causing some initial worries before CrowdStrike announced a fix for the glitch. Despite this, CrowdStrike shares dropped by about 10%. Other tech companies like Microsoft also experienced slight declines.
Meanwhile, former President Donald Trump’s comments about ending the electric vehicle mandate on his first day in office led to a drop in shares of EV makers like Tesla, Rivian, and Lucid. Tech and consumer discretionary stocks experienced declines on Friday, with the Nasdaq 100 down 1%, and Netflix shares experiencing a slight gain after posting better than expected quarterly results.
American Express CEO Stephen Squeri announced plans to increase the marketing budget to $800 million, showing confidence in the company’s performance despite uncertainties related to the upcoming election. While the Fed’s actions may impact consumer confidence, the company believes it will navigate through any challenges that arise. Even with various market fluctuations and technological disruptions, businesses and investors are taking a resilient approach to tackle the current economic climate.
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