Stock markets faced pressure due to concerns around AI model Kimi K3 and higher oil prices. Chip stocks initially struggled but saw some recovery by the close. Netflix reported earnings disappointment
On Friday, stock markets began with caution as investors grappled with potential implications from the open-source AI model Kimi K3. This development raised concerns about the sustainability of investments in training large language models (LLMs), leading to a broader sell-off in chip stocks. The Nasdaq, heavily reliant on tech and semiconductor companies, struggled early but saw some recovery by the close.
Chip giant Nvidia faced significant pressure with its shares dropping 2.3%, as many of their products are used for training rather than inference tasks. Micron Technology also experienced volatility, opening lower before closing at $847 per share, down 0.7%. Other companies like AMD and Qualcomm saw declines as well.
In unrelated news, Netflix's stock tumbled by 7% following its latest earnings report, which missed expectations. Intuitive Surgical faced an even steeper decline of 14%, indicating broader market sentiment towards tech-heavy sectors that might be impacted by cost pressures or regulatory concerns.
Oil prices surged to a one-month high due to ongoing geopolitical tensions and strikes in key producing regions. This led to higher energy costs, which negatively affected overall market performance. Crude oil's strength was also reflected in widening crack spreads, indicating increased demand for refined products over crude.
Gold saw a modest rebound as Goldman Sachs reported on central bank buying activity, though it had initially declined earlier in the day. The metal finished $50 above its lowest point of the session, offering some relief to precious metals traders.
Later in the trading session, President Trump's threat to impose tariffs on Canada over wildfires caused a brief market jolt but was largely seen as posturing by analysts. The Canadian dollar (loonie) outperformed other major currencies during this period, reflecting its resilience against such political rhetoric.
Source: InvestingLive. Summarized and rewritten by the Vexoda Newsroom. This is market news, not financial advice.