US stocks fell sharply on Friday, set to add to Wall Street's steepest sell-off in over a month as ebbing faith in a December interest-rate cut puts pressure on riskier assets like Big Techs.

The Dow Jones Industrial Average (^DJI) slid over 1%, or more than 500 points, while the S&P 500 (^GSPC) dropped around 1.3%. The tech-heavy Nasdaq Composite (^IXIC) tumbled around 1.8%.

Another sea of red grips stocks after Thursday's bruising session, which saw the major indexes log their steepest one-day declines in over a month.

Tech is again at the forefront, as AI concerns drive an exodus to less hotly valued sectors. Tesla (TSLA) shares fell 3% in early trading to break below $400, on the heels of its worst day since July. Nvidia (NVDA), moved 2.6% lower on the heels of a 3.6% drop Thursday.

Also suffering, bitcoin (BTC-USD) fell below $96,000 for the first time in over six months, continuing a slide that has seen the cryptocurrency sink over 20% since its October peak.

The mood is gloomy as worries grow that the Federal Reserve will slow its pace of policy easing, given the increasingly hawkish tone taken by its officials. Traders now see less than 50% odds of a quarter-point rate cut next month, down from about 95% a month ago. Minneapolis Fed President Neel Kashkari became the latest to lose appetite for rate cuts as he flagged "resilience" in the US economy and continued concerns over inflation.

Policymakers lack insight into price pressures as well as the jobs market after the record six-week federal shutdown. Questions still remain as to what data will end up being released — and in what form it will be unveiled — now that the government has reopened.

In a nod to price pressures, President Trump is preparing to make substantial cuts to tariffs to bring down high food costs, a concern for voters in recent state and local elections. Several trade deals with Argentina, Brazil and other Latin American countries also aim to make the likes of bananas and coffee more affordable.

Read more: The best from Yahoo Finance Invest: Big moments, bold insights from top voices

US stocks dropped at the open Friday, with tech leading losses as investors rotated out of riskier assets amid growing doubts over the Fed's path to interest rate cuts following the longest-ever US government shutdown in history.

The Dow Jones Industrial Average (^DJI) fell roughly 0.9%, while the S&P 500 (^GSPC) sank over 1%. The tech-heavy Nasdaq Composite (^IXIC) tumbled around 1.6%.

Tesla (TSLA) and Nvidia (NVDA) dropped 4% and 2.8%, respectively, while Broadcom sank 2.9% after those stocks led a decline in Big Tech names during Thursday's market selloff.

American Bitcoin (ABTC) stock fell 13% before the bell on Friday despite reporting a rise in profit. The company, which has Eric Trump as co-founder, chief strategy officer and Donald Trump Jr as a major stockholder, saw its profit more than double in the third quarter.

Reuters reports:

Crypto has drawn strong interest this year, with investors betting on looser ‌oversight under the new Trump administration and bitcoin trading at record levels, even though the token's rally has slowed in recent weeks.

Eric Trump is American Bitcoin's co-founder and chief strategy officer, while Donald Trump Jr. is a major stockholder in the company.

\\"While others ⁠paid spot, we generated bitcoin ‌below market through scalable, asset-light mining operations. Coupled with disciplined at-market purchases,\\" Eric Trump said in a statement.

Read more here.

Walmart (WMT) announced Friday that longtime CEO Doug McMillon will retire at the end of January. The company's head of US operations, John Furner, has been tapped to replace him.

Shares of America's largest retailer fell by 2.5% ahead of the opening bell.

Economic momentum in China cooled in October, the National Bureau of Statistics of China reported on Friday.

Retail sales in the country grew 2.9% year over year, marking their slowest pace since last year and a cooling from the 3% growth seen in September. Results from Singles Day, China's major shopping holiday in November, also showed modest growth, adding to concerns of a spending slowdown.

Industrial production in China rose 4.9%, its smallest gain since January. Investment in fixed assets decreased by 1.7% year over year.

US-listed Chinese stocks fell in premarket trading on Friday on the disappointing data:

Alibaba (BABA) fell 1.6%

JD.com (JD) dropped 3.4%

Baidu (BIDU) fell 1.4%

Tencent (TCEHY) declined 0.8%

NetEase (NTES) dipped 0.5%

XPeng (XPEV) fell 5.8% while other automakers Nio and BYD also fell

The post-COVID recession that never arrived still hasn't come. But that doesn't mean Americans are in the clear, writes Yahoo Finance's Hamza Shaban in today's Morning Brief. He notes:

Recession-like conditions are already gripping households on the lower end of the income spectrum, putting a dark spin on the saying that the future is already here, it's just not evenly distributed.

That the wealthiest Americans are driving the bulk of consumption has reignited discussion of the K-shaped economy. And while the tendency is to think that markets might be in trouble if those big spenders pull back, the pressure felt by those on the lower rungs can have its own cascading effects.

\\"What does keep me up is what's happening at the lower ends of the income distribution for households where there is significant pressure,\\" said Mohamed El-Erian, chief economic adviser at Allianz, in an interview during Yahoo Finance's annual Invest conference.

El-Erian warned that the cohort of lower earners isn't already in a recession, but they are close to one, raising the prominence of economic and political debate around affordability.

Read more here.

Tesla (TSLA) shares retreated further, down 4% in premarket as the broader tech sector geared up for another sell-off.

The EV maker's stock is now poised to fall below the $400 threshold, revisiting lows not seen since the middle of September.

Tesla had its worst day since late July on Thursday, closing 6.6% lower after recovering from deeper session losses.

Yahoo Finance's Pras Subramanian reports:

As noted by Bespoke Investment, Tesla stock has shed around 10% since shareholders approved Elon Musk's $1 trillion pay package at last Thursday's shareholder meeting.

However, with the saga of Musk's $1 trillion pay package behind it, analysts like Wedbush's Dan Ives remain bullish on Tesla shares, and he believes the automaker's AI future is where investors should be looking.

Ives, who has called passage of Musk's pay package a \\"bright green light\\" for Tesla's AI and autonomous tech plans, has an Outperform rating on the stock and a Street-high $600 price target.

Ives said the first order of business for Musk and Tesla is self-driving and robotaxis.

Read more here.

Economic data: No notable data expected

Earnings calendar: Mitsubishi UFJ Financial (MUFG), Sumitomo Mitsui Financial (SMFG), Mizuho Financial (MFG), LATAM Airlines (LTM), Spire (SPIR), American Bitcoin (ABTC), Legence (LGN), Quantum Computing (QUBT), Perpetua Resources (PPTA)

Here are some of the biggest stories you may have missed overnight and early this morning:

A recession is brewing at the bottom of the K-shaped economy

US unemployment claims edge down in sign of stability

Trump is readying big tariff cuts to ease grocery prices

Bitcoin's bear market deepens as ETF investors yank $870M

Apple's China sales jumped 22% after iPhone 17 launch

Rattled bulls look to strong earnings outlooks as market wobbles

Risk aversion sinks market high flyers as Fed cut hopes dim

Burry's depreciation gripe shines spotlight on Big Tech profits

Fannie Mae officials ousted after flagging Pulte-linked data sharing

Oracle (ORCL) stock fell more than 1% before the bell on Friday and has been among the worst affected by the recent sell-off compared to its Big Tech rivals. The company's borrowing, which has been used to fund its AI initiatives, has worried investors.

The FT reports:

The US software giant founded by Larry Ellison has made a dramatic entrance to the AI race, committing to spend hundreds of billions of dollars in the next few years on chips and data centres — largely as part of deals to supply computing capacity to OpenAI, the maker of ChatGPT.

The speed and scale of its moves have unsettled some investors at a time when markets are keenly focused on the spending of so-called hyperscalers — Big Tech companies building vast data centres.

Oracle shares are down almost 30 per cent in the past month, nearly twice the fall of the next worst-performing hyperscaler, Meta.

The slide has reversed more than $250bn of gains in its market value when the Texas-based group disclosed its deals with OpenAI (OPAI.PVT) in September. A Financial Times index tracking the price of Oracle’s debt has fallen about 6 per cent since mid-September, significantly worse than any of its major peers.

Oracle has prompted particular concern because the group shifted from business software to cloud computing later than its rivals. Its strategy has become more focused on an all-out bet on AI, pinned largely to the success of OpenAI.

Read more here. 

Warner Bros (WBD) stock rose 3% before in premarket trading on Friday after news that Paramount (PSKY), Comcast (CMCSA), and Netflix (NFLX) were preparing bids for the entertainment group.

Whirlpool (WHR) stock rose 3% before the bell on Friday following news that Investor David Tepper’s Appaloosa Management had purchased 5.2 million shares of the appliance maker.

Applied Materials (AMAT) stock fell 5% in premarket trading on Friday after the chipmaker reported a slowdown in revenue. The company's first quarter forecast was more upbeat.

Bloomberg reports:

Bitcoin (BTC-USD) fell further below the $100,000 mark as a bout of risk aversion sweeping across markets saw investors pull nearly $900 million from funds investing in the token.

The largest digital-asset sank as much as 2.8% to below $96,000 on Friday before paring losses, leaving it more than 20% below a record high reached in early October.

The crypto market remains under strain after $19 billion in liquidations on Oct. 10 in turn erased over $1 trillion from the total market value of all cryptocurrencies, CoinGecko data shows. The liquidations keep coming, with more than $1 billion worth of leveraged crypto bets wiped out in the past 24 hours, according to CoinGlass data.

Meanwhile, exchange-traded funds investing in bitcoin saw net outflows of about $870 million on Thursday, the second-largest daily withdrawal since their debut.

Read more here.

Gold (GC=F) prices have been boosted after a month of declines, as uncertainty surrounding data and the aftermath of the government shutdown has led investors to the haven asset.

Bloomberg reports:

Bullion was trading at nearly $4,190 an ounce, heading for a weekly gain of around 5% and recouping most of the losses from the previous session. Expectations of another US rate cut — a tailwind for gold, which doesn’t pay interest — lost some steam throughout the week as Federal Reserve officials showed little conviction for reducing the cost of borrowing.

Still, investors are divided on whether a flood of data when Washington returns from its longest-ever shutdown will show enough weakness to justify a rate cut. Gold is up nearly 60% this year and remains on target for its best annual performance since 1979. Central banks have stepped up purchases, seeking a store of value and asset diversification, while investors have piled into the metal as a hedge against growing fiscal unease in some of the world’s biggest economies.

Bullion continues to find support from the prospect of the Fed injecting further liquidity into the financial system. The US central bank “won’t have to wait long” before purchasing assets to sustain desired liquidity levels, Roberto Perli, who runs the System Open Market Account at the Federal Reserve Bank of New York, said this week.

Read more here.