Chip stocks staged a sharp rebound on Friday, 6 November, as investors bought back into the semiconductor names that had been hit hardest in the previous session's sell-off. Advanced Micro Devices led the recovery, climbing 11.04%, while Intel rose 7.71%, Micron Technology gained 5.12%, Marvell Technology added 5.73% and Arm Holdings rose 4.74%.

Nvidia, the world's most valuable chipmaker, rose 2.78% on the day, and the broader semiconductor index rallied alongside it. The gains helped lift the Nasdaq Composite 1.09% to 24,579.43, while the S&P 500 added 0.32% to close at 7,376.92. The Dow Jones Industrial Average was the outlier, slipping 0.46% to 51,286.21.

The bounce came a day after technology shares suffered their worst drubbing in more than a year. Thursday's sell-off pushed the Nasdaq into correction territory, meaning a fall of 10% from its peak a month earlier, as investors questioned the pace and cost of the artificial intelligence data centre build-out. The selling was triggered by the Democrats' sweeping victory in the US midterm elections, which raised fears that a new Congress could slow or tighten regulation of AI infrastructure spending.

Despite Friday's recovery, the week still ended in the red. The Nasdaq posted a fourth consecutive weekly decline, and the S&P 500 was headed for its worst week since June. The rebound recovered only part of Thursday's losses, leaving the market's mood fragile heading into the weekend.

Investors were also digesting a stronger than expected US jobs report. Nonfarm payrolls increased more than expected in October and the unemployment rate fell to 4.1%, suggesting the labour market remained resilient. Traders added to bets that the Federal Reserve could raise interest rates as soon as next month, with the chance of a December move rising to 78%, from 70% earlier, according to LSEG data.

"We still think AI is the dominant theme in this bull market," said Keith Lerner, chief investment officer at Truist Advisory Services in Atlanta. "We are still giving technology the benefit of the doubt." Adam Turnquist, chief cross-asset strategist for LPL Financial, described the week's heavy selling as "a little bit of a knee-jerk reaction" to the midterm results, adding that "AI has gone on trial several times in this cycle and come away with an innocent verdict."

Tesla was among the other technology shares bouncing back from Thursday's plunge, rising 4.23% on Friday. Among the day's losers, software firm Atlassian dropped after reporting first-quarter results, while Airbnb climbed after the vacation rental platform raised its full-year 2026 revenue growth forecast.

The information technology sector led the S&P 500's gains on Friday, while consumer staples and healthcare lagged. Oil prices were slightly lower, adding to the appetite for riskier assets, although the S&P 500 energy index was on track for a double-digit weekly percentage drop.

Attention now turns to Tuesday, when the Bureau of Labor Statistics publishes the October consumer price index, the last major inflation reading before the Federal Reserve's December meeting. A hotter than expected print could reinforce the case for a rate rise, while a softer one may ease the pressure on technology shares that have been rattled by the prospect of higher borrowing costs.