Key Takeaways
- The major U.S. equities indexes dropped Friday afternoon, wiping out early gains after President Trump threatened “massive” tariffs against China.
- Advanced Micro Devices and other chip stocks were among the S&P 500’s biggest decliners following the news.
- PepsiCo shares added to yesterday’s gains after the soft drink and snacks maker posted better-than-expected results.
The major U.S. equities indexes dropped sharply Friday afternoon, wiping out early gains after President Trump threatened “massive” tariffs on Chinese goods in response to China’s move to tighten rare earths export curbs. The Dow, S&P 500, and Nasdaq all lost over 1%.
China is a leading producer for rare earths that are critical components in a wide range of high-tech products from cars to semiconductors, and chip stocks including Advanced Micro Devices (AMD) and Arm (ARM) were among the S&P 500 and Nasdaq’s biggest decliners. Shares of AI favorite Nvidia (NVDA) also turned lower after climbing to a fresh intraday record, with the PHLX Semiconductor Index (SOX) down 4%.
Adding to Qualcomm’s (QCOM) woes was a report that Chinese regulators are investigating the chipmaker’s purchase of Israel-based car safety semiconductor manufacturer Autotalks over possible antitrust violations.
Mosaic (MOS) was the worst-performing stock in the S&P 500 after the fertilizer maker reported problems at two of its plants significantly held back production. Shares of Levi Strauss (LEVI) also dropped after the jeans maker said tariffs would negatively impact current-quarter results.
PepsiCo (PEP) shares added to yesterday’s gains after the soft drink and snacks maker posted better-than-expected results on higher international demand and strong sales of its healthier drinks in the U.S.
Shares of Applied Digital (APLD) took off as the AI data center firm also beat earnings and revenue forecasts on higher demand for its services, which included a new data center lease agreement with AI computing firm CoreWeave (CRWD).
Gold prices rose, and oil futures sank. The yield on the 10-year Treasury note slid. The U.S. dollar lost ground to the euro, pound, and yen. Most major cryptocurrencies lost ground.
