4:15pm: Broad tech selloff
Wall Street closed deeply in the red on Friday, with technology stocks leading the decline as investors reassessed expectations for Federal Reserve policy following a surprisingly strong US jobs report.
The Nasdaq tumbled 4.2%, shedding 1,122 points to close at 25,709, while the S&P 500 dropped 201 points, or 2.6%, to 7,384. The Dow Jones Industrial Average fell 695 points, or 1.4%, to finish at 50,867.
Markets turned decisively risk-off after data showed the US economy added 172,000 jobs in May, well above expectations. The stronger labour market fueled concerns that the Federal Reserve may need to maintain a hawkish stance, prompting investors to cut exposure to growth stocks.
Technology shares bore the brunt of the selling. The S&P Technology Select Sector Index plunged 6.7%, with AI-related names among the biggest casualties. Nvidia fell 6% as investors questioned lofty valuations across the semiconductor and artificial intelligence space, while Broadcom and other chipmakers also came under pressure.
The selloff ended a remarkable run for the broader market. The S&P 500 fell 2.5% for the week, snapping a 10-week winning streak as traders recalibrated expectations for interest rates and economic growth.
Cryptocurrencies were also caught in the downturn. Bitcoin slid toward the US$61,000-US$62,000 range amid continued ETF outflows and liquidations, while Ethereum posted even steeper losses, slipping well below US$1,800.
By the closing bell, investors had clearly shifted away from speculative and high-growth assets, with the AI-driven rally that powered markets for much of the year hitting a significant roadblock.
3:45pm: Proactive news headlines
- G Mining Ventures Corp (TSX:GMIN, OTCQX:GMINF, FRA:W97) released its 2025 Sustainability Report, highlighting strong safety and environmental performance with zero work-related fatalities across 3.7 million hours worked and low injury rates at its Tocantinzinho Mine in Brazil and Oko West Project in Guyana.
- Ocean Power Technologies Inc (NYSE-A:OPTT) announced a registered direct offering with institutional investors to raise capital through the sale of 25 million shares at $0.40 each, along with warrants to purchase up to 25 million additional shares.
- Abacus Global Management (NYSE:ABX) was named to TIME magazine’s World's Growth Leaders of 2026 list, recognizing the company among the top 1,000 public firms globally for revenue growth, market performance, and financial stability.
- Alvopetro Energy Ltd (TSX-V:ALV, OTC:ALVOF, FRA:A6Y0) reported May production and sales volumes of 3,076 barrels of oil equivalent per day, driven primarily by natural gas operations in Brazil, with additional oil production from its Canadian assets.
2:40pm: Market movers
- Planet Labs shares jumped after the satellite-imaging company announced a new contract with the Swedish Armed Forces, prompting analysts at Wedbush to raise their price target and highlight growing demand for its geospatial intelligence services.
- Rubrik gained ground after the cybersecurity and cloud data-management company delivered stronger-than-expected quarterly results, with revenue rising 39% year over year and management lifting its full-year outlook.
- DocuSign fell despite reporting earnings and revenue ahead of expectations, as investors focused on slower growth in key metrics and softer billings guidance, raising concerns about the pace of future expansion.
1:20pm: A look at inflation
Wells Fargo heads into next week pointing to a firmer inflation picture across major economies.
In the U.S., it expects May CPI to rise 0.5% month-on-month, lifting the annual rate to 4.2%, with energy and food doing most of the heavy lifting, while core inflation stays relatively steady at 0.2% as goods calm down.
In Europe, inflation is picking up more broadly, which could push the ECB toward starting a tightening cycle. Canada is likely to stay on hold for now, balancing softer growth against still-tight labour conditions, while in Brazil, rising inflation pressures are making it harder for policymakers to keep easing.
12:00pm: 'Monster' report
Markets are seeing another tech-led selloff, with investors also worried that stronger-than-expected economic data could push the Fed to shift away from its easing stance this month, XTB's Kathleen Brooks noted.
"The narrow breadth of the recent rally was always a risk for US indices, as a decline in just a few names in the AI sector can weigh heavily on the index. S&P 500 and the Nasdaq, which is what we are seeing now," she commented.
As well, the "monster" jobs report has complicated matters for new Fed chair Kevin Warsh.
"This report adds to pressure on the Fed to drop its easing bias, but it may not trigger a rush to price in rate hikes anytime soon," Brooks added.
11:05am: Jobs data roils markets
Analysts said the jobs report effectively neutralizes the case for near-term Fed rate cuts while stopping short of triggering expectations for hikes.
The probability of a Fed increase by year-end remains below 40%, with steady wage growth suggesting the hiring rebound has not fed through to broader inflationary pressure.
The report nonetheless hands incoming Fed Chair Kevin Warsh a charged backdrop ahead of his first press conference following the June 17 FOMC meeting.
Bill Adams, Chief US Economist at Fifth Third Commercial Bank, noted that payroll growth has averaged 114,000 jobs per month year-to-date, a sharp improvement over last year's near-stagnant pace. "The tailwinds from fiscal and monetary policy, the AI boom, and an ebullient stock market are overpowering headwinds from the Iran War and higher energy prices," he said.
The role of artificial intelligence in reshaping labor markets also drew scrutiny. "AI may eventually kill off jobs, but that time is not now," said Jamie Cox, Managing Partner for Harris Financial Group. "It’s also very difficult to remain anchored to a stagflation narrative when growth and employment are rising."
10:00am: Traders scale back rate-cut expectations
Stocks opened sharply lower on Friday as investors reacted to a much stronger-than-expected May jobs report, raising concerns that the Federal Reserve may need to keep interest rates higher for longer.
The labor market added 172,000 jobs in May, more than double economists' expectations of around 80,000 to 85,000 new positions. The surprisingly strong data prompted traders to scale back hopes for interest rate cuts, with money markets now pricing in roughly a 60% chance of a Fed rate increase before the end of 2026.
Technology stocks led the decline, dragging the Nasdaq down 1.7%, while the S&P 500 fell 0.9%. The Dow Jones Industrial Average was little changed, slipping just 50 points as investors rotated away from high-growth names and into more defensive sectors.
Semiconductor stocks were among the biggest laggards, with Nvidia Corp (NASDAQ:NVDA, XETRA:NVD) and Broadcom Inc (NASDAQ:AVGO, XETRA:1YD) under pressure after Broadcom's latest guidance dampened enthusiasm surrounding the artificial intelligence trade that has fueled much of this year's market rally.
Beyond equities, Treasury yields surged, pushing the benchmark 10-year yield above 4.5%, while the US dollar climbed to an eight-week high. Gold fell roughly 2% as rising yields reduced the appeal of non-yielding assets, and Bitcoin slid to around $62,000, its lowest level since February. Oil prices also edged lower, trading near $92 to $94 a barrel as investors monitored developments surrounding Iran-related peace talks.
For now, Wall Street's focus remains firmly on the strength of the labor market and what it could mean for the Federal Reserve's next move.
8:55am: Jobs surprise
The US labor market came in stronger than expected in May, easing concerns about a slowdown in hiring.
Nonfarm payrolls rose by 172,000 last month, nearly double economists' forecasts for 88,000 new jobs. Private-sector employers added 120,000 jobs, also beating expectations.
The unemployment rate held steady at 4.3%, while labor force participation remained unchanged at 61.8%. Wage growth matched forecasts, with average hourly earnings rising 0.3% from April and 3.4% from a year earlier. The average workweek was unchanged at 34.3 hours.
The report also included sizeable upward revisions to previous months. March job growth was revised up to 214,000 from 185,000, while April payroll gains were raised to 179,000 from 115,000. Together, the revisions added 93,000 more jobs than previously reported, reinforcing the picture of a labor market that has remained resilient despite concerns about slowing economic growth.
7:25am: Ahead of the bell
Wall Street is pointing mostly lower ahead of Friday's May jobs report, with tech bearing the brunt. Nasdaq 100 futures are down 1%, the S&P 500 has slipped 0.5%, while the Dow is marginally in the green.
The jobs numbers land at 8:30am Eastern. Economists expect a modest uptick in payrolls and a steady unemployment rate, which would at least steady nerves at a moment when inflation concerns are creeping back in.
Broadcom's earnings rattled the AI trade overnight, and chipmakers are nursing sharp losses across the board. The Iran ceasefire remains fragile, and Trump's assurances that talks are in their "final stages" are being taken with the usual pinch of salt.
Meanwhile, the S&P 500 is chasing a tenth consecutive weekly gain, which would be its longest winning run since 1985. A lot could change before the closing bell.
In other news, S&P Dow Jones Indices has held firm on its index entry rules, rejecting proposals to fast-track mega-cap IPOs such as SpaceX into the S&P 500. The existing 12-month seasoning period and profitability requirements stay intact, a quiet but significant win for investors who believe benchmarks should not bend to accommodate hype.
Payroll data: What to look for
Non-farm payrolls land at a particularly delicate moment, arriving just two weeks before the Federal Reserve's first meeting under its new chairman, Kevin Warsh, and at a time when markets have dramatically shifted their bets from expecting rate cuts this year to pricing in an actual hike by December.
The headline number is expected to show around 85,000 new jobs created in May, down from 115,000 in April, which sounds weak but is actually fine given how dramatically the picture has changed.
Here's the key thing most people miss: the US economy doesn't need to create as many jobs as it used to.
The sharp slowdown in immigration has pushed down what economists call the breakeven rate, the minimum number of jobs needed each month just to keep unemployment stable, from around 150,000 to roughly 85,000 today, and the Fed has flagged it could fall close to zero by the end of 2026 as immigration slows further.
Meanwhile, the labour market is sending mixed signals: job openings are at a two-year high, but workers are staying put rather than quitting for better offers, a classic sign of a market that is resilient but cautious.
The real tension Warsh inherits is that inflation, stoked by the Iran war's effect on energy prices, is arguably a bigger threat than unemployment right now, making rate cuts politically popular but economically questionable.
His confirmation hearing suggested he believes AI-driven productivity gains will eventually allow rates to fall, which is probably right in the long run, but the inflationary pressures bearing down on the economy right now are stubbornly real-world rather than technological.
The upshot: a rate hike as early as July looks increasingly plausible, which would put Warsh on an immediate collision course with a president who has consistently pushed for cheaper borrowing.
Today's number probably won't settle that debate, but it will sharpen it considerably.