Key Takeaways

• Futures fall sharply: S&P 500 futures dropped 1.1% to 7,440.50, Nasdaq 100 futures slid 1.5%, and Dow Jones futures fell 0.6%.
• Chip export disappointment: USTR Jamieson Greer said chip export controls were “not a major topic” in U.S.-China talks.
• Nvidia premarket drop: Shares fell 1.2% after surging to record highs Thursday on H200 sales reports.
• No deliveries yet: Despite reports of H200 clearance to 10 Chinese companies, no actual sales have been made.
• Trump’s Iran threats: The president vowed “the military decimation of Iran” and said he’s “not going to be much more patient.”
• Ceasefire on “life support”: Earlier warnings continue to fuel escalation fears.
• Oil surges: Crude prices rose sharply following Trump’s comments.
• Treasury yields spike: 10-year yields jumped nearly 2% to a near one-year high early Friday.
• Trump-Xi summit ends: The president concluded his three-day visit; Xi cited “progress” but few concrete details emerged.
• China oil deal claim: Trump told Fox News China agreed to buy U.S. oil — plus Boeing jets, agricultural goods, and Visa access.
• Records set Thursday: S&P 500 and Nasdaq hit all-time highs, with the Dow above 50,000.
• Vital Knowledge warning: Adam Crisafulli says the SPX is “unappealing at present levels” as “all the positives appear priced in.”
• Hot inflation in focus: This week’s strong inflation readings raised fears of a hawkish Fed turn.

U.S. stock index futures lost ground on Thursday evening after a U.S. official said recent bilateral talks with China did not focus on semiconductor export controls — dampening hopes for more chip sales to Beijing.

Hawkish comments from U.S. President Donald Trump on Iran also spurred caution, especially as oil prices rose sharply following his comments.

Markets were also spooked by a sharp increase in Treasury yields, amid growing concerns over the inflationary impact of the Iran war. The 10-year yield surged nearly 2% to a near one-year high early Friday.

“We continue to think the SPX is unappealing at present levels, not because the news isn’t good, but instead because all the positives appear priced in,” Vital Knowledge analyst Adam Crisafulli wrote in his Thursday-close note.

S&P 500 futures fell 1.1% to 7,440.50 points by 04:42 ET (08:42 GMT). Nasdaq 100 futures slid 1.5% to 29,224.25 points, while Dow Jones futures fell 0.6% to 49,763.0 points.

Futures retreated after Wall Street hit record highs during Thursday’s session, buoyed chiefly by Nvidia on the prospect of more sales to China.

But outsized losses in Nasdaq futures on Friday indicated that chips and tech shares were on track for some profit-taking after recent gains.

Greer Says U.S.-China Talks Did Not Cover Chip Export Controls

Futures turned negative after U.S. Trade Representative Jamieson Greer told Bloomberg TV that Washington’s chip export controls were “not a major topic of discussion” during bilateral talks with China earlier in the day.

His comments came after Reuters reported on Thursday that NVIDIA was allowed by the U.S. to sell its second-most powerful artificial intelligence chip — the H200 — to 10 companies in China.

But the report also noted that not a single delivery had been made so far, with the status of Nvidia’s China sales remaining uncertain. CEO Jensen Huang traveled to China with Trump this week and was seen seeking a breakthrough in chip sales to the country.

Greer said it was up to China as to whether to purchase more U.S. chips.

Nvidia had surged to record highs on Thursday following the Reuters report, also driving sharp gains on Wall Street. The stock fell 1.2% in premarket trade.

The S&P 500 and the Nasdaq Composite hit record highs on Thursday, while the Dow Jones Industrial Average finished above 50,000 points and in sight of its February peak.

Trump, Xi Conclude Second Round of Talks; Iran Warning Weighs

Trump and Xi concluded a second round of talks on Friday, with Chinese media reports indicating that Trump had left Beijing after a three-day visit.

Xi said the two sides had marked progress toward building a better U.S.-China relationship, Chinese media reported.

But more details on just what trade agreements were reached during Trump’s China visit remained scant. Beijing had flagged Taiwan as a major point of focus for the talks.

In a Fox News interview aired Thursday evening, Trump claimed that China had agreed to purchase oil from the U.S. after his talks with Xi.

Trump also touted Chinese commitments to purchase Boeing jets, agricultural goods, and to open up the country to Visa, although details remained unclear.

Trump said China was seeking a swift end to the Iran war, and said that he was “not going to be much more patient,” urging Tehran to accept a trade deal.

Trump threatened more debilitating military strikes against Iran, after earlier this week warning that the ceasefire was on life support. Oil prices rose sharply on Friday following his comments.

Markets remained on edge over the inflationary impact of the Iran war after a series of strong inflation readings this week. The prints showed that rising energy prices factored into higher living costs for Americans in April, and also sparked fears of a more hawkish Federal Reserve in the coming months.