Black Friday on US stock markets! Billions of dollars evaporated

The final trading day of the week in US markets concluded with news that unsettled investors in the financial world. The May employment figures released by the US Department of Labor exceeded expectations, creating a perception in the market that the Fed might adopt a more hawkish stance on interest rate policy. This triggered sharp sell-offs in stocks.

The Dow Jones index, closely watched worldwide, finished the day down 1.35% at 50,866.78 points. While the S&P 500 index lost 2.64% to fall to 7,383.74 points, the technology-heavy Nasdaq index plummeted by 4.18% to 25,709.43 points. This marked the largest daily decline for the Nasdaq since April 2025.

Intense selling in chip manufacturer stocks also drew attention. Broadcom shares fell another 7.9% after losing more than 12% the previous day. Marvell Technology dropped 16.7%, and Micron Technology fell 13.3%. Shares of industry leader Nvidia decreased by 6.2%, while Advanced Micro Devices (AMD) fell 10.9% and Intel declined by 11.3%.

HIGHER-THAN-EXPECTED GROWTH IN US LABOR FORCE

According to economic data, non-farm payrolls in the US increased by 172 thousand last month, exceeding market forecasts. The unemployment rate remained largely unchanged at 4.3%. Additionally, employment growth data for previous months were revised upward; March was raised from 185 thousand to 214 thousand, and April from 115 thousand to 179 thousand.

Analysts point out that while the US labor market is losing momentum in some sectors, it maintains its overall resilience. The fact that the annual inflation rate in the US remains above desired levels has strengthened the possibility of an interest rate hike by the central bank before the end of the year.

There was also volatility in the bond market. Following the strong employment data, the US 10-year Treasury yield rose above 4.5%, while the 30-year Treasury yield exceeded the 5% threshold.

Signals from Fed officials are being closely monitored. Cleveland Fed President Beth Hammack stated that the employment data shows a largely stable trend in the labor market, noting, "Given the uncertainties regarding the economic outlook for today, keeping interest rates steady is reasonable. However, if recent trends continue, it may be appropriate to act soon."

GLOBAL RISKS AND GEOPOLITICAL DEVELOPMENTS

On the other hand, the ongoing tension in the Middle East and the lack of concrete progress in peace dialogues in the region emerged as another factor reducing investors' risk appetite. Analysts point out that geopolitical developments combined with economic indicators in the US are negatively affecting the investment environment.

Whether this sharp volatility in US stock markets will continue to impact the markets next week is being watched with curiosity.

News Source: 12punto