Nasdaq and S&P 500 Turn Lower Friday Morning as Nvidia Slides Again and the 10-Year Yield Holds Above 5%

Wall Street's technology-heavy indexes lost their early footing Friday morning as investors weighed a mixed inflation report, another drop in Nvidia and Treasury yields that refuse to come down. CNBC reported that the S&P 500 and the Nasdaq Composite gave up early gains and slipped into negative territory in morning trading, with the S&P 500 down 0.4% and the Nasdaq off 0.7%, while the Dow Jones Industrial Average was up 43 points, or 0.1%. In a later update, CNBC said the Nasdaq had fallen 0.9% and the S&P 500 0.6%, with the Dow hovering near the flatline.

Yahoo Finance likewise reported the S&P 500 and Nasdaq turning lower as the wholesale inflation numbers sank in and Nvidia shares fell; its market snapshot around 10 a.m. Eastern showed the Nasdaq down about 1.4%, the S&P 500 down about 0.9% and Nvidia off about 3.3%. The pattern pointed to selling concentrated in large technology names, while the blue-chip Dow held up better.

The retreat followed a hopeful start. Stock futures initially popped after the October producer price index was released, then pared those gains, according to CNBC. The report showed wholesale prices rising 0.3% for the month, a bit below the 0.4% economists had expected, but CNBC noted the annual increase was the hottest in nearly four years. That combination gave investors a little relief on the month and fresh reason for caution on the trend. Even with Friday's softer morning, CNBC said the major averages remained on pace to finish the week with gains.

Nvidia remained the market's center of gravity in its first days under finance chief Colette Kress, who took over as interim chief executive after founder Jensen Huang stepped down. CNBC reported that the chipmaker's shares fell more than 2% Friday, extending a drop of more than 4% in Thursday's session, as the fallout from the scandal surrounding Huang's exit continued.

The losses have been piling up for weeks. CNBC reported that Nvidia stock is down for a sixth week, a slide that has erased about $1.6 trillion in market value. Because Nvidia is one of the largest companies in the major indexes, its moves weigh heavily on the S&P 500 and Nasdaq, which helps explain why those benchmarks lagged the Dow on Friday morning.

For long-term investors, the question now is less about the founder who left than about whether the business he built can keep its footing during the transition. Given the company's weight in the market, a steady handoff matters well beyond Nvidia's own shareholders.

The bond market took little comfort from the slightly softer headline inflation number. CNBC reported that the 10-year Treasury yield stayed above 5% after the producer price report, trading around 5.15%, while the 2-year yield, which closely tracks expectations for Federal Reserve policy, was near 4.87%. Yields at those levels raise borrowing costs for home buyers, businesses and the government alike, and they give investors a competitive alternative to stocks.

Traders also kept their bets on a December rate hike. FXStreet reported that CME FedWatch data on Friday showed markets treating a December increase as close to certain, with about 87% odds of a quarter-point hike and about a 12% chance of a larger half-point move. The same outlet reported that the U.S. dollar index climbed to a 19-month high near 103 on Friday, a sign of how strongly currency traders are leaning on the prospect of tighter Fed policy.

Oil, which has swung sharply with the Iran war, was calmer. Invezz reported that Brent crude was holding near $96 a barrel Friday after the International Energy Agency said the world oil market was moving toward its first surplus since the war began. Steadier crude would be welcome news for drivers and for anyone hoping inflation cools further, though energy prices have proven quick to reverse in recent months.

Earnings reports added to the day's crosscurrents. CNBC reported that Cisco shares were down 3% in the morning despite what it described as a solid beat in the networking company's fiscal first quarter. Applied Materials, the chip-equipment maker, reported fourth-quarter earnings of $4.16 a share excluding items on revenue of $10.41 billion, topping the $4.05 a share and $10.30 billion that analysts polled by LSEG had expected, CNBC reported. Its shares were slightly lower before the opening bell, according to CNBC, a reminder that strong numbers are not always enough when the broader chip sector is under pressure.

The mixed reaction to solid results fits a market that is focused less on individual company reports and more on two big questions: how high the Federal Reserve will push interest rates, and how quickly Nvidia can steady itself under new leadership. With the producer price report now behind them, investors will be watching every word from Fed officials ahead of the central bank's December meeting, as well as any word from Nvidia's boardroom on a permanent successor.

For ordinary savers with retirement accounts tied to these indexes, Friday's moves were modest. The broader lesson of a volatile week is a familiar one: patience and a long view tend to serve families better than reacting to every headline.