Nasdaq slipped into correction territory Friday, with the Nasdaq 100 roughly 11% below its October high. Major indexes finished sharply lower — the S&P 500 at 6,368.85, the Dow at 45,167.44 and the Nasdaq 100 near 23,138 — after a 2% Friday drop. Traders said the sell-off accelerated as oil topped $110 a barrel and Iran-related tensions dented risk appetite, hitting tech — especially memory and capex-dependent firms — hardest.

Market rout pushes Nasdaq into correction The Nasdaq 100 fell about 2% on Friday to roughly 23,138, its lowest level in about seven months, meeting one common definition of a correction after moving roughly 11% below its all-time high of 26,119 in October. The Dow lost about 792 points to close near 45,167.44 and the S&P 500 fell to 6,368.85. Stocks finished a fifth straight week of losses, a streak that has tightened selling pressure across the market. The slide has been concentrated, with technology-heavy indexes leading as mega-cap and memory shares — whose valuations and expected capital spending plans are sensitive to rising costs — underperformed. The Nasdaq is on pace for its 10th losing week in the last 11 weeks, a run Paul Hickey, co-founder of Bespoke Investment Group, called rare in the index's history. Tech sectors leading the sell-off Investors targeted memory stocks and other areas that had been among the year's biggest winners. Those groups have retraced much of their earlier gains as traders reprice expectations for corporate capital expenditure and semiconductor demand. Sentiment in tech is mixed: some strategists point to valuation relief after earlier run-ups, while others warn cyclical forces tied to earnings and shifting yields could pressure tech earnings in coming quarters. Sell-side and buy-side desks broadly categorized the selling two ways: - Growth valuation reset — longer-term repricing of richly valued names. - Externally driven risk — immediate selling tied to macro or geopolitical events, which dominated Friday's moves. Oil spike and geopolitics squeeze risk appetite Oil prices climbed, with Brent trading back above $110 a barrel on reports linked to the conflict involving Iran. That rise tightened inflation concerns and prompted investors to step away from risk assets. Reports that the Strait of Hormuz was effectively closed and some foreign vessels were turned away added to market nervousness and kept risk sentiment weak. "The weekend approaches with war tensions mounting and investors shying from risk," Joe Mazzola, head trading and derivatives strategist at Charles Schwab, wrote, with traders citing the risk that higher crude could feed through to inflation and further pressure growth while the U.S. economy shows signs of cooling. Technical alarms and what traders are watching Beyond macro and sector drivers, technical signals added to the bearish tone as traders monitor trend lines and recent lows for signs of stabilization or further weakness.

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The Nasdaq 100 finished near 23,138 — about 11% below its October peak and its weakest close in roughly seven months.

This article was created with AI assistance.