Published: November 14, 2025 – Midday New York trading
US stocks fell again on Friday, November 14, 2025, with the Dow, S&P 500 and Nasdaq all down around 1% as tech and AI high‑flyers slumped and investors scaled back expectations for a December Fed rate cut amid a “data fog” caused by the long U.S. government shutdown
Key takeaways
- All three major indexes are down for a second straight session, extending Thursday’s sharp sell‑off and pulling further off recent record highs. [1]
- Tech and AI leaders are leading the decline, with chipmakers and “Magnificent Seven” names under heavy pressure again. [2]
- Fed rate‑cut odds for December have dropped to roughly a 50–50 coin flip after hawkish comments from policymakers and missing economic data caused by the 43‑day U.S. government shutdown. [3]
- Bond yields remain elevated, with the 10‑year Treasury yield holding just above 4.1%, keeping pressure on rate‑sensitive sectors like housing, banks and real estate. [4]
- Safe‑haven trades are in focus: gold has jumped around 5% this week toward $4,190 while Bitcoin is down about 3%, reflecting broader risk‑off sentiment. [5]
Market snapshot: Indexes extend Thursday’s rout
U.S. stocks opened sharply lower on Friday and stayed under pressure through late‑morning trading, putting the market on track for a second big daily loss in a row.
- Shortly after the opening bell, the S&P 500 was down about 0.9% at roughly 6,678, while the Dow Jones Industrial Average fell around 1.1% to just under 47,000 and the Nasdaq Composite slid about 1.0%, according to early trading data. [6]
- By around 9:36 a.m. ET, losses deepened: the Dow was off 1.24% at 46,889, the S&P 500 down 1.09% at 6,664, and the Nasdaq Composite lower by 1.44% at 22,553, while the CBOE Volatility Index (VIX) pushed up toward 23, its highest level in about a week. [7]
The weakness comes on the heels of Thursday’s steep sell‑off, when the S&P 500 dropped 1.7% to 6,737.49, the Dow fell 1.7% to 47,457.22, and the Nasdaq Composite tumbled 2.3% to 22,870.36—one of Wall Street’s worst days since April. [8]
Put together, the past two days have knocked the major averages noticeably off their recent all‑time highs, especially in tech‑heavy segments of the market.
Fed “data fog” and the end of the shutdown are clouding rate hopes
A key driver of the latest downturn is growing doubt that the Federal Reserve will deliver another interest‑rate cut in December, as traders had been confidently expecting only a few weeks ago.
Two overlapping issues are unsettling investors:
- A 43‑day U.S. government shutdown has created a data blackout.
- The shutdown, which only ended on Thursday, disrupted the collection of crucial figures on inflation and employment. Some October data—such as parts of the jobs report and possibly the inflation report—may never be published. [9]
- Fed Chair Jerome Powell has likened the situation to “driving in the fog,” suggesting policymakers may move more cautiously—meaning fewer or slower rate cuts. [10]
- Fed officials have turned noticeably more hawkish in recent days.
- Several regional Fed presidents, including officials in Boston, Cleveland and St. Louis, have signaled that they don’t see an urgent need for further easing given persistent inflation risks. [11]
- Market‑based odds of a 25‑basis‑point cut in December have slid from near certainty a month ago to roughly 50–53% today, and were closer to 70% just a week ago. [12]
For equity investors who had bid stocks to record highs on the assumption of multiple rate cuts, this rapid repricing is painful. Forward valuations for the S&P 500 sit around 22.8 times next‑12‑month earnings, well above the 10‑year average of about 18.8, according to market data. [13]
With earnings expectations already rich and the Fed now more cautious, it doesn’t take much to trigger an unwinding of crowded trades.
AI and mega‑cap tech stocks are leading the sell‑off
The epic run in artificial‑intelligence and mega‑cap tech stocks—the primary engine behind this year’s rally—has become the focal point of the correction.
- On Thursday, AI darlings took heavy hits: Nvidia, Super Micro Computer, Palantir and Broadcom all fell sharply, with some drops exceeding 6%. [14]
- Even after the pullback, some names remain up well over 100% year‑to‑date, raising comparisons to the dot‑com bubble of 2000 from strategists concerned about how far valuations have stretched. [15]
The selling continued into Friday:
- Applied Materials plunged more than 6% after warning that tighter U.S. export controls would curb China spending next year, dragging the broader semiconductor index down about 3%. [16]
- Other chipmakers—including Nvidia, Broadcom, Intel and AMD—fell between roughly 2% and 4% in early trading. [17]
- A popular ETF tracking the so‑called “Magnificent Seven” mega‑cap tech stocks slid about 2%, and the S&P 500’s information technology sector was also down around 2%. [18]
Traders say the move reflects a shift away from momentum‑driven AI trades and into more defensive positioning. As one portfolio manager told Reuters, after months of relentless gains, investors are “finally acting on” long‑standing worries about overvaluation in these names. [19]
Higher yields pressure housing, banks and other rate‑sensitive sectors
While tech gets the headlines, interest rates remain the macro story.
- The 10‑year U.S. Treasury yield is holding just above 4.1%, near levels seen on Thursday, when it climbed by about 4 basis points. [20]
- A typical 30‑year U.S. mortgage rate has pushed up to about 6.24%, raising borrowing costs for homebuyers and cooling housing‑related demand. [21]
Elevated rates tend to:
- Support bank margins (they can earn more on loans),
- But weigh on loan growth and real estate values,
- And make equities less attractive versus “risk‑free” government bonds.
Friday’s sector moves reflected that tension:
- Financials showed mixed trading, with some banks benefiting from higher yields even as broader market weakness weighed on sentiment. [22]
- Real estate and other rate‑sensitive groups underperformed, as investors questioned how long the Fed will keep conditions restrictive in the face of patchy data. [23]
Safe‑haven flows: Gold shines, Bitcoin stumbles
The risk‑off tone isn’t limited to stocks. Alternative assets and safe havens are flashing their own warning signs.
- Gold prices have surged roughly 5%, trading near $4,190 an ounce, as investors hedge against policy uncertainty and market volatility. [24]
- Bitcoin, which had previously rallied alongside speculative tech, has fallen about 3%, dropping back toward levels last seen in May. [25]
The divergence—gold up, crypto down—suggests a market shifting from aggressive risk‑taking to more traditional forms of protection.
Global markets echo Wall Street’s anxiety
The sell‑off is not confined to the United States. Overnight and regional markets mirrored Wall Street’s unease about AI valuations and the Fed’s next moves.
- In Asia, major benchmarks including South Korea’s KOSPI, Japan’s Nikkei 225, Taiwan’s Taiex and Hong Kong’s Hang Seng all fell sharply, with chip‑heavy indexes particularly weak as investors dumped AI‑linked names. [26]
- In Europe, indexes such as the FTSE 100 and DAX opened lower, tracking losses in U.S. futures and reflecting worries about global growth and tight monetary policy. [27]
On the commodities front:
- U.S. benchmark crude (WTI) traded around $59.5 per barrel, while Brent crude hovered near $63.8, adding modest gains after this week’s bounce. [28]
Currency markets reinforced the risk‑off tone, with the U.S. dollar gaining versus the yen on Thursday and early Friday as investors sought safety in dollar‑denominated assets. [29]
How unusual is this pullback?
Given the scale of the AI‑driven rally since April, many strategists see the current slump as a sharp but not unexpected correction, rather than a definitive trend change—at least so far.
Key context:
- The Nasdaq is still only about 5% below its October peak, even after its worst weekly stretch since April. [30]
- Year‑to‑date, sectors tied to technology and AI are up more than 20%, far outpacing the broader market. [31]
- Corporate earnings haven’t collapsed; in fact, roughly 80%+ of S&P 500 companies beat earnings expectations in Q3, with overall profits rising well above initial forecasts. [32]
The problem is that lofty valuations now depend heavily on continued Fed support and strong growth. With rate‑cut odds slipping and hard data partially missing because of the shutdown, investors are re‑pricing that optimistic scenario.
What investors are watching next
As the session progresses and into next week, markets will be focused on several key catalysts:
- Upcoming inflation and labor data
Even though the shutdown has delayed and distorted normal releases, any figures that do emerge on prices or employment will be scrutinized for clues about whether inflation is cooling fast enough to justify more cuts—or staying sticky enough to force the Fed to pause. [33] - Further Fed commentary
Multiple Fed officials are scheduled to speak in the coming days. Any hint that policymakers are open to backing away from December easing could add to volatility, while a softer tone might help stabilize sentiment. [34] - AI and chip‑sector earnings
With Nvidia and other key chipmakers set to report in the coming days, their guidance on AI demand, export controls and capital spending will be crucial for tech valuations—and by extension, for the broader indices. [35] - Positioning and volatility
Rising VIX levels and reports of systematic funds cutting equity exposure suggest that mechanical selling has amplified the move lower. Traders will watch whether that pressure eases or accelerates if indexes break additional technical support levels. [36]
What it means if you’re an investor (not personal advice)
For long‑term investors, the message of the past 48 hours is less about predicting the exact bottom and more about re‑assessing risk:
- Concentration risk: If your portfolio is heavily skewed toward a handful of AI or mega‑cap tech names, the recent swings highlight how quickly sentiment can reverse in crowded trades.
- Rate sensitivity: With the Fed still fighting inflation and data uncertain, it’s risky to assume a smooth path to lower rates. Sectors like growth tech, small caps and high‑yield credit remain especially sensitive.
- Diversification and time horizon: Broad diversification across sectors, regions and asset classes—and an appropriately long time horizon—can help cushion episodes like this.
This article is for general information only and is not individualized investment advice. Anyone considering changes to their portfolio should weigh their own goals, risk tolerance and financial situation, and consider speaking with a qualified financial professional.
References
1. www.reuters.com, 2. www.reuters.com, 3. www.reuters.com, 4. www.nasdaq.com, 5. m.economictimes.com, 6. www.ndtvprofit.com, 7. www.reuters.com, 8. www.wral.com, 9. www.reuters.com, 10. www.reuters.com, 11. www.nasdaq.com, 12. www.reuters.com, 13. www.reuters.com, 14. www.wral.com, 15. www.wral.com, 16. www.reuters.com, 17. www.reuters.com, 18. www.reuters.com, 19. www.reuters.com, 20. www.nasdaq.com, 21. simplywall.st, 22. m.economictimes.com, 23. m.economictimes.com, 24. m.economictimes.com, 25. m.economictimes.com, 26. www.wral.com, 27. www.wral.com, 28. www.wral.com, 29. www.wral.com, 30. www.reuters.com, 31. www.reuters.com, 32. www.nasdaq.com, 33. www.reuters.com, 34. www.reuters.com, 35. www.reuters.com, 36. m.economictimes.com
