NEW YORK, New York - U.S. stock markets suffered a brutal beating on Friday, with the tech-heavy NASDAQ leading a dramatic sell-off as a global collapse in semiconductor stocks combined with rising interest rates across the world to send investors fleeing for cover.

The NASDAQ Composite was the hardest hit among major indices, plummeting 1,121.53 points to close at 25,709.43, a staggering decline of 4.18 percent on volume of 9.090 billion shares. It marked the index's worst single-day performance in nearly two years, as chip giants Nvidia, AMD, and Intel saw double-digit percentage losses.

The broad-based Standard and Poor's 500 also suffered heavy damage, falling 200.63 points to finish at 7,383.68, a drop of 2.65 percent on trading volume of 3.496 billion. Decliners outnumbered advancers by a wide margin across every major sector, with information technology and communication services leading the rout.

The Dow Jones Industrial Average fared relatively better but still posted a substantial loss. The blue-chip index tumbled 695.15 points to close at 50,866.78, down 1.35 percent on volume of 632.585 million shares. Despite the smaller percentage decline compared to the NASDAQ and S&P 500, the Dow still shed nearly 700 points as rate-sensitive financial and industrial stocks weighed on the index.

The sell-off was triggered by two converging forces. First, a global rout in chip stocks spread from Asian markets to Europe and finally to North America after a major semiconductor manufacturer issued cautious forward guidance, sparking fears of a demand slowdown. Second, a series of central bank signals pointing to further interest rate hikes — including hawkish comments from Federal Reserve officials and unexpected tightening moves overseas — sent bond yields soaring and crushed valuations for growth-dependent technology companies.

All three major U.S. indexes closed near their session lows, with traders pointing to automated selling programs that accelerated losses in the final hour of trading. The NASDAQ's 4.18 percent plunge represented its largest one-day percentage decline since September 2022.

"This is a bit of profit taking," Anshul Sharma, chief investment officer at Savvy Wealth told CNBC Friday. "The AI narrative still remains intact, but I do think that the expectations got more elevated than they thought, and I think even relatively good news can end up disappointing when it's not as high as where the expectations are."

Stock markets were also impacted Friday by a spike in U.S. Treasury yields, which followed a Bureau of Labou Statistics report showing nonfarm payrolls increased by 172,000 in May, well above the 80,000 jobs expected. The unemployment rate held steady from April at 4.3 percent, in line with expectations.

U.S. Dollar Powers Ahead as Stocks Plummet, Bond Yields Rise

The U.S. dollar posted a powerful performance against major currencies on Friday, posting solid gains against the Swiss franc, the euro, British pound, and commodity currencies.

The euro weakened substantially against the greenback. The EUR-USD pair settled at 1.1525, down 0.74 percent, reflecting broad-based selling pressure on the single currency following disappointing economic data out of the eurozone.

The British pound also suffered a rough session. GBP-USD finished at 1.3337, a decline of 0.65 percent as traders continued to assess the Bank of England's policy path heading into the end of the year.

The Japanese yen, meanwhile, lost ground against the dollar. USD-JPY rose to 160.19, marking an increase of 0.11 percent as the U.S. currency found modest bid interest.

Commodity-linked currencies saw notable moves. The Australian dollar fell sharply, with AUD-USD closing at 0.7044, down 1.26 percent — the largest percentage decline among the major pairs tracked. The decline came amid falling iron ore prices and renewed risk aversion in global markets.

The Canadian dollar also weakened against its U.S. counterpart. USD-CAD climbed to 1.3945, a gain of 0.27 percent for the greenback, as oil prices eased from recent highs.

In what stood out as one of the day's strongest move, the Swiss franc dived against the dollar. USD-CHF climbed to 0.7962, representing a gain of 0.84 percent for the U.S. currency, as investors sought refuge in the safe-haven franc amid lingering geopolitical uncertainty.

Global Markets Have Volatile Day Friday as Seoul Plunges 5.54 percent, London Ekes Out Gains

World stock markets closed a volatile Friday session with deep red ink spilling across most major indices.

Canadian markets were not spared. The S&P/TSX Composite index dropped 803.42 points to end at 34,413.64, a loss of 2.28 percent on volume of 321.353 million shares. The TSX's decline was led by technology and base metal mining stocks, though energy shares also slumped amid concerns that higher rates could slow global economic growth.

Despite the carnage, London's FTSE 100 managed to carve out a modest gain as investors digested a raft of economic signals and a brutal selloff in South Korea.

The FTSE 100 in London bucked the downward trend, adding 7.73 points to close at 10,368.05, an increase of 0.07 percent. The modest advance provided a sliver of optimism as European counterparts struggled.

Continental Europe faced notable declines. Germany's DAX P fell 185.90 points to finish at 24,759.05, a drop of 0.75 percent.

In France, the CAC 40 slid 26.05 points to 8,218.24, off 0.32 percent.

The pan-European EURO STOXX 50 I lost 41.26 points, settling at 6,062.07 for a loss of 0.68 percent, while the Euronext 100 Index declined 9.10 points to 1,857.70, down 0.49 percent.

In Brussels on Friday, the BEL 20 was a rare bright spot, rising 41.27 points to 5,579.60, a gain of 0.75 percent.

Asian markets saw widespread carnage, led by an extraordinary crash in Seoul. The KOSPI Composite Index plunged a staggering 478.82 points to close at 8,160.59, a breathtaking loss of 5.54 percent on volume of 463,197 trades. It was the worst single-day performance among major indices tracked.

In Hong Kong, the HANG SENG INDEX dropped 291.45 points to end at 24,961.95, down 1.15 percent.

Taiwan's TWSE Capitalization Weighted Stock Index fell 606.52 points to 45,070.94, a loss of 1.33 percent, while in Japan, the Nikkei 225 shed 882.57 points to finish at 66,588.12, declining 1.31 percent.

Elsewhere in the Asia-Pacific region on Friday, the STI Index in Singapore retreated 17.57 points to 5,049.96, down 0.35 percent.

Australia saw twin declines: the S&P/ASX 200 fell 61.00 points to 8,625.10, off 0.70 percent, and the broader ALL ORDINARIES lost 61.00 points to close at 8,855.90, a drop of 0.68 percent. New Zealand's S&P/NZX 50 INDEX GROSS rose 60.36 points to 13,161.97, adding 0.46 percent.

India's S&P BSE SENSEX eased 116.66 points to 74,243.34, a modest decline of 0.16 percent.

In Indonesia, the IDX COMPOSITE suffered heavy selling, plunging 245.02 points to 5,594.77, down 4.20 percent.

Malaysia's FTSE Bursa Malaysia KLCI was a rare gainer, climbing 10.17 points to 1,693.43, an increase of 0.60 percent.

The Top 40 USD Net TRI Index dropped 154.14 points to 6,755.97, a loss of 2.23 percent.

Mainland China's SSE Composite Index fell 26.19 points to close at 4,057.78, a decline of 0.64 percent on volume of 1.867 billion shares.

In the Middle East, Israel's TA-125 slipped 20.14 points to 4,206.36, down 0.48 percent. Most other Mideast markets were closed and were due to reopen on Sunday.

(This report incorporates quotes retrieved with the assistance of artificial intelligence).

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