Stocks Slide Friday as Kimi AI, Oil Surge, Netflix Drag Markets
Wall Street closed lower Friday as AI competition fears, surging crude prices, and weak Netflix earnings weighed on equities.
U.S. equity markets finished Friday in the red as a convergence of pressures — Chinese AI competition, a sharp crude oil rally, and disappointing single-stock earnings — sent the Nasdaq down 1.3% and the S&P 500 off 0.9%, capping a rough week that saw the tech-heavy index shed nearly 3%.
The session's early turbulence traced directly to Kimi K3, an open-source AI model from Chinese startup Moonshot that posted benchmarks rivaling leading systems from Anthropic and OpenAI. Investors interpreted the release as evidence that the AI model layer lacks a durable competitive moat, triggering a broad chip selloff on fears that next-generation models could make expensive training hardware economically obsolete. Nvidia fell 2.3%, bearing the brunt of the selling given its heavy exposure to training workloads. Micron whipsawed between $804 and $903 before settling down just 0.7%, while all Magnificent Seven names except a flat Apple closed lower.
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Single-stock pain compounded the damage. Netflix tumbled 7% on earnings, and Intuitive Surgical plunged 14%, both dragging sentiment further. Meanwhile, WTI crude oil surged $2.94 to $81.89 per barrel — a one-month high — as geopolitical tensions showed no sign of easing, with Iran reportedly targeting a vessel attempting to transit the Strait of Hormuz and both sides exchanging escalatory threats heading into the weekend.
Gold staged a notable intraday recovery, finishing up roughly $42 at $4,011 after Goldman Sachs highlighted continued central bank buying, recovering from a much steeper earlier loss. The Canadian dollar outperformed all major currencies despite a late-session threat from President Trump to impose additional tariffs on Canada over wildfire smoke drifting from Minnesota — a move markets appeared to largely dismiss as posturing.
On the economic data front, June import prices rose 0.3% against an expected decline of 0.7%, while housing starts beat estimates at 1.427 million units. Industrial production edged up just 0.1%, missing the 0.2% forecast. University of Michigan consumer sentiment for July came in at 54.4, topping the 51.0 consensus. Continue reading at Forexlive.
