S&P 500 Posts Worst Month Since March as Risk Aversion Grows – US Market Wrap

Wall Street traders moved away from riskier areas of the market, sending stocks lower on geopolitical concerns and anxiety over private credit, a key funding source for technology companies. Treasuries advanced, capping their strongest monthly performance in a year, while oil rose.

Friday’s decline left the S&P 500 with its biggest monthly loss since March. Fears of an AI bubble resurfaced after OpenAI raised $110 billion. Bank shares dropped as investors remained uneasy following the recent collapse of a UK mortgage lender. Strategists at UBS warned that private credit default rates could climb as high as 15% if AI triggers aggressive disruption.

Sentiment was also weighed down by hotter-than-expected producer prices and escalating Middle East tensions. UN inspectors reported unexplained activity at Iranian uranium-enrichment sites that had previously been targeted.

Meanwhile, Goldman Sachs’ asset management unit said redemption levels and software exposure are relatively limited in one of its largest retail-focused private credit funds.

The S&P 500 fell 0.4%. The yield on 10-year Treasuries dropped five basis points to 3.95%. Oil hovered near $67 a barrel, while gold rose above $5,200.