FX.co ★ US Stocks Pull Back from Records

US equity benchmarks pulled back from record highs as a rebound in Treasury yields pressured earnings prospects in rate‑sensitive sectors. The S&P 500 and Nasdaq 100 slipped 0.5% and 0.7%, respectively, from all‑time peaks, while the Dow declined 1%.

Geopolitical tensions added to the risk backdrop. Iranian strikes on vessels transiting the Strait of Hormuz intensified already-elevated shipping insurance premiums for tankers in the region, reinforcing concerns over potential energy‑driven inflation. Long‑dated borrowing costs also stayed elevated, underpinned by mounting federal budget deficits.

AI infrastructure names surrendered earlier‑week gains as higher yields and wider credit spreads weighed on order outlooks. Shares of Micron, AMD, Oracle, Lam Research, and Applied Materials all fell about 2%. This came despite ostensibly supportive sector news that SpaceX plans to borrow $40 billion to purchase Nvidia chips. Nvidia shares still ended 1% lower, and SpaceX declined 3%.

Defensive areas outperformed in this environment, with pharmaceuticals and consumer staples advancing.