It took only four sessions for the U.S. stock market to recover most of the losses triggered earlier in the week after the Chinese startup DeepSeek launched a more efficient and cost-effective AI platform than OpenAI‘sChatGPT, sparking a sharp selloff on Wall Street.
Investors began questioning the need to allocate capital to higher-cost AI-related companies, sending shares of top chipmakers and data centers into a tailspin.
Yet resilient quarterly earnings reports and a significantly less hawkish Federal Reserve Chair Jerome Powell compared to his stance in December gave bulls the confidence to buy the dip.
As widely expected, the Federal Reserve left interest rates unchanged at 4.25%–4.5%. Surprisingly, Powell instilled greater hopes for potential rate cuts in the future, stating that monetary policy remains “meaningfully restrictive.”
The scars remained visible for Nvidia Corp. NVDA, which lost about 15% in a week, with the chipmaker falling again on Friday following reports that U.S. plans to levy a 10% tariff on China.
Risk sentiment deteriorated during Friday afternoon trading in New York amid escalating tariff concerns.
President Donald Trump said again he plans to introduce 25% tariffs on imports from Mexico and Canada, though reports differed on when it would go into effect.
On Friday, White House press secretary Karoline Leavitt said tariffs are coming Saturday.
“The President will implement 25% [tariffs] on Mexico, Canada and 10% on China,” Leavitt stated.
Analysts warn that such a measure could cause significant economic disruptions in North America, with the U.S. automotive industry among the most affected.
Cruise liners were among the best performers in the S&P 500 for the week, with Royal Caribbean Cruise Ltd. RCL, Norwegian Cruise Line Holdings Ltd. NCLH and Carnival Corp. CCL all posting double-digit percentage gains following strong earnings from Royal Caribbean.
United Parcel Service Inc. UPS was one of the worst laggards, plunging about 15% — its worst week since September 2008 — after the parcel service agreed with Amazon.com Inc. AMZN to phase out more than 50% of the e-commerce giant’s volume by the second half of 2026.
You might have missed…
Microsoft AI Strength
Wall Street analysts assessed Microsoft Corp. MSFT‘s quarterly results, weighing Azure’s slowing growth against its AI-driven potential. Despite cloud challenges, analysts said Microsoft remains a compelling investment due to its strategic advancements in artificial intelligence.
Musk Wins Back Advertisers
Amazon.com is increasing its ad spending on X, reversing previous cuts. Apple Inc. AAPL is also considering resuming ads on the platform, signaling a potential recovery in advertiser confidence under Elon Musk’s leadership.
GM Earnings Beat
General Motors Co. GM exceeded earnings expectations last quarter, posting strong revenue growth. Yet the company incurred over $5 billion in charges after halting funding for its Cruise robotaxi business and restructuring operations in China. Analysts remain optimistic about GM’s long-term growth and turnaround potential.
Read Next:
Market News and Data brought to you by Benzinga APIs
© 2025 Benzinga.com. Benzinga does not provide investment advice. All rights reserved.
