U.S. equities traded lower on Friday, with the Dow Jones Industrial Average falling more than 200 points. The broader market weakness was led by sharp declines in specific biotech and materials names, offsetting modest gains in energy and select tech sectors.

The Dow closed down 0.45% at 51,544.44, while the NASDAQ Composite declined 0.16% to 26,376.37. The S&P 500 index also slipped, dropping 0.24% to 7,619.32.

Sector Performance

Energy shares were the only major sector to post gains, rising by 0.2%. In contrast, materials stocks faced significant selling pressure, falling by 1.4%.

Top Movers

Xenon Pharmaceuticals Inc (NASDAQ: XENE) saw its shares drop 29% to $40.55. The decline followed the company's announcement of a voluntary temporary pause in enrolling new patients in ongoing psychiatry studies. Multiple firms subsequently lowered their price targets for the stock.

Stardust Power Inc (NASDAQ: SDST) shares fell 39% to $0.15, reversing part of Thursday’s rally as investors digested an updated stock offering and potential dilution risks. Evolution Metals & Technologies Corp (NASDAQ: EMAT) dropped 13% to $3.52 after entering a securities purchase agreement to issue $30,927,835 of convertible debentures.

On the positive side, Securitize Corp (NYSE: SECZ) shares rose 10% to $9.81 after StoneX analyst Mark Palmer raised the price target from $10 to $12. Hyperliquid Strategies Inc (NASDAQ: PURR) surged 6% to $13.63 following SEC approval of innovation relief for tokenized U.S. stock trading. Mistras Group Inc (NYSE: MG) gained 6% to $21.01 after agreeing to an all-cash acquisition by H.I.G. Capital affiliates.

Economic Data

U.S. industrial production remained unchanged in August, following a 0.2% gain in July. This missed market estimates of a 0.3% rise. Manufacturing output fell 0.3% in August, compared to expectations of a 0.3% increase. The CB Leading Index declined 0.1% month-over-month in August.

Global Markets

European shares declined broadly. The STOXX 600 fell 1.1%, while Spain’s IBEX 35 dropped 1.6%. Germany’s DAX dipped 1.6%, France’s CAC 40 tumbled 1.5%, and London’s FTSE 100 fell 0.3%.

Asian markets closed mostly higher. Japan’s Nikkei 225 gained 1.38%, China’s Shanghai Composite rose 0.94%, and Hong Kong’s Hang Seng index increased 0.60%. India’s BSE Sensex fell slightly by 0.03%.

Commodities

Oil prices traded up 0.1% to $101.99. Gold declined 0.1% to $4,394.30. Silver rose 1.2% to $66.855, while copper increased 0.1% to $6.6695.

The Dow Jones Industrial Average fell more than 600 points on Wednesday, closing at 51,461.90, after the Federal Reserve raised the federal funds target range by 25 basis points to 3.75%-4.00%. This marks the central bank’s first rate increase since 2023.

Market Reaction and Sentiment

Broad market indices closed lower, reflecting investor caution following the policy decision. The S&P 500 declined 0.45% to settle at 7,551.81. The Nasdaq Composite slipped marginally by 0.01% to close at 25,978.42.

Sentiment indicators reinforced the bearish tone. The CNN Money Fear and Greed index dropped from a prior reading of 28 to 26, remaining firmly in the "Fear" zone. The index, which ranges from 0 (maximum fear) to 100 (maximum greed), suggests that heightened anxiety is exerting downward pressure on stock prices.

Sector Performance and Stock Movers

Most sectors within the S&P 500 finished negative. Energy, financial, and materials stocks recorded the largest losses during the session. Conversely, information technology and health care stocks bucked the broader trend, closing higher.

Individual stock movements highlighted specific corporate developments:

• LuxExperience BV-ADR (NYSE: LUXE) shares rose 23% after reporting fourth-quarter results.
• DataMeds AI Inc. (NASDAQ: MEDS) shares jumped 275% following an announcement that it acquired Helomics.

Investors are also awaiting earnings results from Upexi Inc. (NASDAQ: UPXI).

Economic Data Highlights

Key economic data released for August showed mixed signals compared to market expectations:

U.S. export prices rose 0.6% month-over-month, beating the expected 0.5% gain after a 1.4% decline in July. Import prices increased by 0.7%, surpassing the estimated 0.4% rise. Retail sales expanded by 1.2%, significantly outperforming the forecasted 0.8% increase and reversing July's revised 0.5% decline.

What the Numbers Show

The Federal Open Market Committee stated that inflation remains elevated, noting that the current policy action supports a timelier return to its 2 percent goal. Despite strong retail sales growth of 1.2%, equity markets reacted negatively to the rate hike, suggesting investors are prioritizing the cost of capital over near-term consumer spending strength. The divergence between rising import/export prices and falling equity indices indicates that inflationary pressures remain a dominant concern for market participants.