Nasdaq 100: AI Trade Led by AMD Weakens as 30-Year Yield Hits 5.1%

Stocks Drop as Yields Top 5% and the AI Trade Hits a Wall

The Dow Jones Industrial Average fell more than 400 points Friday. The S&P 500 and Nasdaq Composite both moved lower after spending most of the week near record levels. The 30-year Treasury yield topped 5.1%. The 10-Year U.S. Treasury yield hit 4.58%, its highest level since May 2025. Spot Brent crude rose more than 3% to around $109 a barrel. The AI trade that carried this market to record highs ran into a combination of forces it could not ignore and Friday was the day the market admitted it.

Technical Outlook

The Nasdaq Composite Index is trading sharply lower shortly after the mid-session on Friday, but considerably higher than the intraday low.

The short-term range is 25,739.22 to 26,707.14. The index is currently trading on the strong side of its pivot at 26,223.18 after straddling it most of the session.

If this intraday move creates enough upside momentum into the close, traders could take a run at yesterday’s close at 26,635.22. A trade through 26,707.14 will signal a resumption of the uptrend.

A sustained move under 26,223.18 will be a sign of increasing selling pressure with the pivot at 25,810.13 the next target.

The nearest minor bottom is 25,739.22. Taking out this level will change the minor trend to down and shift momentum to the downside.

Earlier in the session, the Nasdaq Composite turned lower for the week. A close under last Friday’s settlement at 26,247.08 will form a weekly closing price reversal top, which could trigger the start of a deep correction if confirmed next week.

We’re looking for a steady trade into the close if 26,223.18 holds as support. If it fails then sellers may take another shot at 26,247.08, increasing the chances of a potentially bearish weekly closing price reversal top.

Yields and Oil Hit at the Same Time

The 30-year U.S. Treasury yield above 5.1% and the 10-Year above 4.58% are not numbers that growth stocks can ignore. Three consecutive hot inflation prints this week gave the bond market everything it needed to push yields to these levels.

Now oil is running on top of that. Spot Brent crude above $109 and June WTI crude up roughly 3% going into the weekend means the inflation picture does not improve on its own next week. Higher oil feeds transportation costs, production costs and consumer prices before the month is out.

The Fed has no room to move and the market is starting to price in the possibility that the next move is a hike not a cut. CME FedWatch data shows the chance of a December rate increase has more than doubled over the past week to around 40%.

Chip Stocks Led the Decline

Nvidia dropped more than 3% Friday. Advanced Micro Devices fell more than 3%. Intel sank more than 6%. The Philadelphia Semiconductor Index slid 3.5%. Micron Technology also posted losses.

The names that led this rally the hardest are taking the biggest hits when the macro turns against them. That is not surprising. What is worth noting is that the AI enthusiasm driving these stocks has not changed. Nvidia’s earnings are still next week. The H200 approval for Chinese buyers is still real. The structural demand story is intact. What changed this week is the rate environment underneath those stories and at 40% odds of a December hike that environment is getting harder to trade through.

The Beijing Summit Added to the Disappointment

Trump and Xi wrapped up their summit without the major agreements Wall Street had been hoping for.

Boeing continued declining after reports that China’s planned aircraft purchases came in smaller than expected. No significant trade developments emerged. No meaningful economic cooperation was announced. Traders who had positioned for a Beijing breakthrough came away with nothing and that disappointment landed on top of everything else that was already hitting stocks Friday. A summit that produces no catalyst is not neutral for a market that needed one.

Microsoft and the Energy Sector Bucked the Trend

Microsoft rose more than 3% after reports that Pershing Square built a position in the company. That is a vote of confidence from a high-profile investor and the market rewarded it on a day when most technology names were selling off.

Healthcare stock Dexcom also gained after announcing board changes tied to activist investor Elliott Investment Management. The energy sector was the only major S&P 500 sector in positive territory Friday, gaining about 1.4% as oil prices climbed. Software stocks showed relative strength too, rising roughly 2%. The rotation into energy and away from semiconductors is the clearest signal of how the market is repositioning around the inflation and rate story.

What to Watch

The inflation and yield picture going into the weekend is the most important fundamental fact. The 30-year U.S. Treasury yield above 5.1% with oil above $109 and a 40% chance of a December rate hike priced in is not a backdrop that resolves itself over the weekend. The Beijing summit delivered nothing that changes it.

A close under last Friday’s Nasdaq Composite settlement at 26,247.08 today forms a weekly closing price reversal top. That is the technical signal that confirms the macro pressure is translating into a genuine trend change. Watch 26,223.18 into the close. Hold it and the bulls have a chance to stabilize. Lose it and 26,247.08 gets tested and the reversal top becomes the story going into next week.

More Information in our Economic Calendar.