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The Dow Jones Industrial Average gained more than 300 points on Friday as oil prices fell sharply. Investors reacted to reports that Pakistan may help restart talks between the United States and Iran.
The S&P 500 also moved higher, while the NASDAQ Composite stayed near flat as chip shares declined. The market showed a clear split between easing energy concerns and fresh pressure on technology stocks.
The Dow Jones rose about 0.7%, helped by a gain of roughly 3% in Apple shares. The S&P 500 added around 0.6%, while the NASDAQ struggled to hold gains as semiconductor stocks moved lower.
Brent crude dropped more than 4% and traded near $95 a barrel after moving above $100 earlier this week. West Texas Intermediate also fell about 4% to trade above $88. Lower oil prices reduced concerns over another rise in inflation, transport costs and company expenses.
Reuters reported that Pakistan is exploring a route to restart stalled talks between Washington and Tehran. Three Pakistani sources said China started the diplomatic effort. Pakistani officials also discussed the plan with Iranian representatives during recent meetings.
Still, the sources said, “obstacles to any talks with the US remain high.” China has strong trade and energy interests in the Gulf. Pakistan also has close ties with Beijing, Saudi Arabia and Iran, which makes its possible role as a mediator more complex.
Oil had climbed above $100 after continued fighting raised fears of supply disruption across the Gulf and Red Sea. US strikes on Iranian targets and attacks linked to Iran-backed groups kept energy traders focused on shipping routes and production risks.
Meanwhile, the Strait of Hormuz has become a major concern for China and other large oil buyers. Any disruption through the waterway could restrict crude shipments and increase global energy costs. Friday’s diplomatic report reduced some of those fears, leading traders to sell oil futures.
Semiconductor stocks fell even as the Dow and S&P 500 advanced. Intel dropped about 3% after initially rising on results that beat Wall Street forecasts. Broadcom and Advanced Micro Devices also lost around 2%, while Micron Technology fell about 5%.
The Philadelphia Semiconductor Index declined more than 3% in early trade. Investors continued to question the pace of artificial intelligence spending after Alphabet and Tesla reported higher capital costs and cash use. The concern also set a cautious tone before results from Microsoft, Amazon and Meta.
Verizon gained after the company raised its annual forecasts for adjusted profit and free cash flow. Real estate and communication services also led gains across the S&P 500 as investors moved toward sectors with less exposure to chip weakness.
Additionally, Citi raised its price targets for Dell and Hewlett Packard Enterprise. Analyst Asiya Merchant kept buy ratings on both companies, citing demand for servers, networking equipment and AI infrastructure. Citi lifted its HPE target to $74 from $70, pointing to about 55% upside from Thursday’s closing price.
Investors also assessed new US tariffs of 10% and 12.5% on goods from 60 trading partners. The Trump administration linked the duties to weak enforcement of forced-labor restrictions. The new rates followed the expiry of a temporary 10% global tariff.
The Federal Reserve will meet next week as markets weigh the inflation risk from energy costs. Futures pricing showed about a one-in-three chance of an interest rate increase, compared with 12% one week earlier. Fed Chairman Kevin Warsh has kept the central bank focused on price stability and employment.
Despite Friday’s rise, the Dow and S&P 500 continued to track small weekly losses. The NASDAQ headed for a decline of more than 1% as technology weakness offset the relief created by lower oil prices.
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