Stock Indexes Fall as Chip Shares Drop and Oil Prices Rise

U.S. stock indexes fell Friday as shares of computer chip companies declined on concerns that their valuations may be too high and that demand for processors and memory may not continue at current levels. The S&P 500 dropped 0.8 percent and was on track for its first losing week in three weeks.

m. Eastern time.

Chip stocks were the main source of weakness.

Nvidia fell 2.8 percent and Applied Materials dropped 6.1 percent. The declines followed weeks of pressure on the sector over questions about whether artificial intelligence will deliver the expected profits and productivity gains. Asian markets also declined. Indexes fell 6.5 percent in Taipei, 4 percent in Tokyo and 3 percent in Shanghai.

Oil prices rose as the conflict with Iran continued.

Brent crude increased 3.1 percent to $86.87 per barrel, up from about $76 a week earlier. The United States expanded its airstrike campaign against Iran early Friday, striking additional bridges and a tower at a key port. Higher oil prices pushed Treasury yields higher earlier in the week, though the 10-year Treasury yield eased to 4.52 percent on Friday from 4.57 percent the previous day.

The average 30-year mortgage rate reached its highest level in nearly a year. A preliminary University of Michigan consumer sentiment survey showed improvement beyond economists' expectations, with its highest reading since February. The survey's director said much of the gain reflected recent declines in gasoline prices.