U.S. stocks were mixed Friday as a rocky week came to a close, marked by geopolitical swings, earnings surprises, and sector rotations. After back-to-back gains earlier in the week on easing geopolitical fears, markets struggled to hold momentum as a major sell-off in Intel weighed on sentiment.
The Dow Jones Industrial Average fell about 0.5%, pressured by weakness in industrial and legacy tech names, while the S&P 500 hovered near the flatline. The Nasdaq Composite rose roughly 0.5%, supported by selective strength in large-cap technology and AI-linked stocks, even as broader risk appetite cooled.
Market Movers:
- Ericsson (ERIC) +9%: Shares surged after the company delivered stronger-than-expected fourth-quarter results, highlighted by margin expansion and robust free cash flow. Investors also welcomed a higher proposed dividend and a new share buyback, reinforcing confidence in capital returns despite ongoing macro uncertainty.
- Fortinet (FTNT) +8%: The stock jumped after TD Cowen upgraded the company to Buy, citing improving demand across secure networking and unified SASE offerings. Analysts said AI adoption is acting as a tailwind rather than a threat to security software, supporting stronger growth expectations.
- Booz Allen Hamilton (BAH) +7%: Shares climbed after the company raised its full-year profitability outlook despite reporting a year-over-year revenue decline. Strong margin performance and disciplined cost control helped offset softer sales and reassured investors on earnings durability.
- Intuitive Surgical (ISRG) +3%: The stock rose after the company reported solid fourth-quarter results driven by continued growth in da Vinci and Ion system placements. While management guided to slower procedure growth in 2026, demand trends remained healthy and margins resilient.
- Intel (INTC) -14%: Shares plunged after the company issued first-quarter guidance that fell short of expectations, overshadowing a better-than-feared fourth quarter. Management flagged near-term supply constraints in server CPUs and sharply lower margins, raising concerns about the pace of its turnaround.
- Bausch Health (BHC) -7%: The stock dropped after its Phase 3 liver-disease program failed to meet its primary endpoint. While the drug was deemed safe, the trial setback raised doubts about near-term pipeline catalysts.
- Mobileye (MBLY) -5%: Shares declined after HSBC downgraded the stock, pointing to a softer-than-expected 2026 revenue outlook. Analysts said the lack of growth visibility caught investors off guard and pressured profitability expectations.
Intel’s Outlook Fuels Semiconductor Volatility
Intel’s steep sell-off was a focal point on Friday, reigniting debate over the sustainability of its recent rally. While demand for AI-driven data center capacity remains stable, the company’s guidance highlighted how execution challenges and supply bottlenecks can quickly undermine investor confidence. The move also weighed on broader semiconductor sentiment, reminding investors that not all chipmakers are benefiting equally from AI enthusiasm. Markets have increasingly differentiated between companies with clear near-term earnings leverage and those still in the midst of structural transitions.
Geopolitics Cool, but Risk Appetite Remains Fragile
Earlier relief around easing geopolitical tensions faded as the week progressed, with investors reassessing exposure to U.S. assets. While tariff threats tied to Greenland negotiations cooled, uncertainty around global trade relationships and political signaling continues to inject volatility into markets. Gold prices extended their rally after breaking fresh record highs, reflecting ongoing demand for hedges amid policy uncertainty. Meanwhile, the dollar weakened modestly, adding to the sense that global investors remain cautious on U.S. risk positioning.
Earnings Season Raises the Stakes
With one of the busiest weeks of earnings ahead, markets are bracing for heightened volatility. Investors are particularly focused on whether corporate guidance can support elevated valuations amid slowing growth indicators and sticky inflation. The Federal Reserve’s upcoming policy meeting and speculation around the next Fed chair are adding another layer of uncertainty, as traders recalibrate expectations for rates and liquidity conditions in the months ahead.
Looking Ahead
Markets enter the final week of January facing a delicate balance between earnings optimism and macro risk. Strong results could help stabilize sentiment after a choppy start to the year, but guidance missteps — like Intel’s — may continue to trigger sharp, stock-specific sell-offs. As investors look ahead to the Fed decision, major tech earnings, and evolving geopolitical dynamics, volatility is likely to remain elevated, with leadership narrowing to companies that can clearly deliver growth in an increasingly selective market.
