Wall Street mixed, ends week with losses amid Mideast war, AI spending fears

Wall Street experienced a mixed close on Friday, with the Dow Jones Industrial Average edging up 0.46% to 51,947 points. However, the week concluded with losses across major indices, including the S&P 500 and the tech-heavy Nasdaq. The Dow Jones fell 0.38% weekly, the S&P 500 dropped 0.61%, and the Nasdaq saw a more significant decline of 2.13%.

The market's volatility this week was largely influenced by escalating tensions in the Middle East, particularly between the United States and Iran, and the opening of a new conflict front involving Yemen's Houthi rebels and Saudi Arabia. This geopolitical instability sent oil prices soaring, with West Texas Intermediate (WTI) crude surpassing $90 a barrel and closing the week up 3% at $89.31. The fear of conflict in the Bab al-Mandeb strait, a crucial shipping route, fueled the price increase.

In response to rising oil prices and geopolitical uncertainty, investors sought safer assets, leading to an increase in U.S. Treasury bond yields. The 10-year yield reached its highest level since 2025 before moderating to 4.684% by Friday's close. Meanwhile, technology stocks faced pressure. Despite optimistic expectations for results from companies like Alphabet, forecasts of substantial spending on artificial intelligence (AI) infrastructure weighed down the Nasdaq. Both Google's parent company and Tesla raised their annual capital expenditure forecasts, concerning investors about future costs. Major tech firms like Meta, Microsoft, and Amazon are set to release their earnings reports next week.

In other markets, gold saw a slight increase of 0.13% to $4,055 an ounce, and silver rose by 0.75% to $58.49 an ounce. The market's focus now shifts to upcoming earnings reports from tech giants, which could further shape investor sentiment.