US equities fell sharply on Friday as technology shares led a broad selloff following stronger than expected US jobs data.
The Dow Jones Industrial Average was down 1.3%, the S&P 500 fell 2.6% and the Nasdaq Composite dropped more than 4%, marking its steepest one day decline since April 2025. Nvidia slid around 6% as pressure intensified across chipmakers and AI-linked names.
The May employment report showed 172,000 jobs added compared with forecasts of around 88,000. The unemployment rate held at 4.3%.
The combination pointed to a resilient labour market but also reinforced expectations that the Federal Reserve will keep policy tighter for longer. Traders are now fully pricing in at least one rate hike by the end of the year as inflation remains persistent and rate cut hopes fade.
The reaction was most pronounced in technology and semiconductors, where selling pressure deepened a rotation that had already begun earlier in the week.
Broadcom extended losses after earlier AI-related weakness, while Micron, AMD and Intel also fell sharply as investors reduced exposure to high growth tech names that have driven much of the market’s gains this year.
Capital rotated into more defensive areas instead. Healthcare, utilities and consumer staples saw relative strength as investors shifted towards steadier earnings profiles.
Names such as Kraft Heinz and Keurig Dr Pepper benefited from the move, although the broader tone suggested repositioning within equities rather than a full exit from risk assets.
The weakness also ended a strong run for US markets.
The S&P 500 posted a weekly decline of around 2.5% and snapped a 10 week winning streak. The Nasdaq’s slide underlined growing concern that valuations in mega-cap technology stocks may have moved too far ahead of fundamentals.
Digital assets moved in the same direction, with Bitcoin and other cryptocurrencies selling off as investors reduced exposure to risk across markets.
Geopolitical uncertainty added another layer of caution amid fragile US-Iran ceasefire discussions and stalled negotiations, even as US President Donald Trump insisted talks remain in their “final” stages.
Trump also criticised the market reaction to the jobs data, arguing that too much emphasis is placed on inflation. He said strong economic figures should support equities rather than weigh on them.
Attention now shifts to next week when Trump is expected to meet leading artificial intelligence executives at the White House to discuss proposals for the US government to take public stakes in selected AI firms, a move framed as a way for citizens to share in the sector’s gains.
