U.S. stocks were mixed late on Friday, with the S&P 500 index turning lower and chip stocks continuing to fall
In the early morning of July 25th, Beijing time, U.S. stocks were mixed in late trading on Friday. The S&P 500 turned lower, dragged down by chip stocks, as investors assessed the latest developments in the Middle East conflict. The Dow rose 165.63 points, or 0.32%, to 51877.28 points; the Nasdaq fell 157.55 points, or 0.63%, to 24980.14 points; the S&P 500 fell 2.68 points, or 0.04%, to 7405.62 points. Stocks were briefly higher and oil prices retreated earlier in the session on Friday after media reported that Pakistan was considering paving the way for new peace talks between the United States and Iran, citing three Pakistani sources. But sources said the obstacles to dialogue with the United States remain high. Earlier this week, US President Donald Trump said he would soon make a decision on whether to launch a "massive attack" on Iran after the conflict in the Middle East spilled into a new battlefield in the Red Sea. In an interview with Axios, the president said the proposed strike would be larger than any war effort seen so far, saying Iran "hasn't suffered enough yet." "I'm considering a massive attack. Bigger than ever. I'm about to make a decision. We're ready for everything," Trump said in the interview. Media reported on Friday that Trump was meeting with senior advisers and core cabinet members to make a decision on whether to escalate the U.S. attack on Iran. Oil prices recovered from their lows following the report. Brent crude futures, which briefly topped $100 a barrel earlier this week - for the first time since late May - have fallen back from that level and are now trading around $96, down 4%. U.S. West Texas Intermediate crude futures fell 3% to trade above $89 a barrel. Traders may be reluctant to hold positions overnight over the weekend due to the possibility of a more aggressive attack on Iran during the weekend. In the past two weeks, the US military has continued to attack Iranian targets, and Central Command has completed its 13th consecutive night of air strikes. "The situation in the Middle East has the potential to have real economic consequences in terms of reducing hydrocarbon flows and the absorptive capacity of the global economy to deal with this problem," Bill Nosey, investment director of Asset Management Group, said. While Nosy believes U.S. monetary rates will remain unchanged next week given this week's surge in oil prices, he added: "Federal Reserve Chairman Kevin Warsh has been very clear about bringing inflation back to his target in the U.S. economy as a policy option, and we take him at his word." Shares fell 6%, reversing early gains after the chipmaker's second-quarter results beat Wall Street expectations. Other chip stocks followed suit, with Broadcom and Advanced Micro Devices each down 3%. Technology fell 8%, with the VanEck Semiconductor ETF (SMH) retreating 3%. "I think you're just seeing a lot of very large money moving in and out of this sector every day, but when we step back and look at where the strong earnings growth is, where it exists in the current environment, and what's driving expectations for 2026 and 2027, those (chip stocks) are the primary beneficiaries," Noci said. "We just need to understand that there will be some sentiment-driven flows in and around this sector," he continued. The index and S&P 500 were both expected to end the week lower, down 0.6% and 0.7% respectively. The index is expected to fall more than 2% this week.