# U.S. tech stocks plunged more than 3% by midday Friday.

*business, fintech · news · 2026-06-05 · Benzinga*

## Key points

- The U.S. economy added 172,000 nonfarm payrolls in May, doubling expectations and surprising markets.
- Odds of a Federal Reserve rate hike by year-end surged to near certainty due to strong jobs data.
- Nasdaq 100 fell 3.2%, marking its worst daily decline since October 2025 amid rising rate fears.
- Bitcoin dropped 17% this week, its steepest weekly loss since the FTX collapse in November 2022.
- Semiconductors and AI hardware stocks led losses, with the XLK sector ETF down about 5%.

U.S. tech stocks plunged more than 3% by midday Friday after a hotter-than-expected jobs report fueled speculation that the Federal Reserve may raise interest rates later this year. The economy added a robust 172,000 nonfarm payrolls in May, crushing expectations for 85,000. Payroll gains for March and April were also revised higher by a combined 93,000 jobs. The unemployment rate held steady at 4.3%. Combined with April’s hot inflation reading, which showed the consumer price index rising 3.8% year over year — the highest level since May 2023 — the labor market data reinforced expectations for further monetary tightening. Odds of a quarter-point rate hike by year-end surged to near certainty, while money markets priced in a roughly 60% chance of an additional hike in 2027. Treasury yields moved sharply higher, with the policy-sensitive 2-year Treasury yield jumping more than 10 basis points to 4.15%. The 10-year yield rose to 4.54%. The dollar strengthened broadly, with the trade-weighted U.S. Dollar Index gaining nearly 1% on the day. On Wall Street, the Nasdaq 100 tumbled 3.2% — putting the tech-heavy benchmark on track for its worst daily decline since October 2025 — as high-growth AI stocks came under pressure from rising rate expectations. The S&P 500 retreated 1.8%, while the Dow Jones Industrial Average slipped just 0.8%, reflecting its lower exposure to technology stocks. Small caps fared no better against the yield backdrop, with the Russell 2000 sliding about 2.6%. The Volatility Index or VIX – known as Wall Street’s fear gauge – jumped 21%. In commodities, precious metals sold off sharply, with gold down 3.1% and silver plunging nearly 7%. Bitcoin has now fallen 17% this week, putting it on track for its worst weekly performance since November 2022, when the collapse of FTX triggered a broad selloff across digital assets. Friday’s Performance In Major US Indices According to the Benzinga Pro platform: Chips Crater As Defensives Soak Up The Rotation The Technology Select Sector SPDR Fund (NYSE:XLK) was by far the worst-performing corner of the market, sliding roughly 5% as semiconductors and AI hardware bore the brunt of the Broadcom hangover. The VanEck Gold Miners ETF (NYSE:GDX) sank roughly 7% as bullion retreated. The defensive bid showed up at the top of the leaderboard. Friday’s Russell 1000 Top Gainers Friday’s Russell 1000 Top Losers Photo: Lightspring/Shutterstock

**Countries:** United States

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