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Add The New York Post on Google Major stock indexes fell Friday to wrap up a losing week, with shares of chipmakers plunging on mounting AI threats from China and renewed fighting in the Middle East.
The Dow Jones Industrial Average fell 380 points, or 0.7%, while the S&P 500 and Nasdaq plunged 1% and 1.4%, respectively, as all three benchmarks ended the week in the red.
Apple on Friday surpassed Nvidia as the most valuable US company as the iPhone maker’s stock rose less than 0.1% while the chipmaker fell 2.7%.
Tesla founder Elon Musk lost his trillionaire status this week – down to a net worth of $807.1 billion, according to Forbes – as shares of SpaceX were hammered, sinking more than 13%.
Mounting concerns over massive AI spending and the potential to create an “AI bubble” have fueled weeks of choppy tech stock trading – but the sell-off intensified Friday on reports that China is catching up to the US in the AI race.
Fresh rounds of air strikes between the US and Iran near the Persian Gulf also sent stocks on the decline this week, after President Trump said the ceasefire with Tehran was “over.”
Brent crude oil prices jumped 3.9% Friday to $87.44 a barrel while West Texas Intermediate crude rose 3.8% to $81.92.
Kuwait said Friday that Iran attacked a power and water plant, while US Central Command said it had completed its sixth consecutive evening of strikes against Iran.
Iran also said Friday that it targeted US military forces in Syria and Bahrain.
Analysts have warned that it could take many months for US gasoline prices to drop below the $3 level – and that’s only if a permanent peace deal to reopen the Strait of Hormuz is reached.
Chinese AI firm Moonshot on Friday unveiled a new open-source model with capabilities that it says rival those of American firms Anthropic and OpenAI.
“Whatever gap existed between American and Chinese frontier AI just got a lot smaller, and it happened on the exact morning Wall Street was busy convincing itself AI economics don’t add up,” Mark Malek, chief investment officer at Siebert Financial, said in a note Friday.
Just two weeks ago, Chinese startup Z.ai released an AI model that is nearly as advanced as Anthropic’s ultra-powerful Fable and Mythos – and it has already landed on a leaderboard of the world’s 10 most popular bots.
As The Post has reported, experts have been sounding the alarms over the threat cheap Chinese AI models pose to US labs known for charging top dollar for the “tokens” needed to power their chatbots.
Shares in major chipmakers including Samsung, TSMC, AMD and Broadcom plummeted 8.8%, 2.8%, 1.1% and 0.5%, respectively.