S&P 500 Slides After Trump-Xi Summit Ends With No Chip Deal and 10Y Yields Punch Through 4.6%

The Summit That Didn't Deliver

Trump left Beijing on Friday calling the summit "fantastic", but the actual deliverables traders were positioned for never showed up. Not a single Nvidia H200 chip has shipped to any of the ten approved Chinese buyers, rare-earth exports from China are still running roughly 50% below pre-restriction levels, and the proposed bilateral AI governance framework produced no signed document. What did land was vague: nebulous talk on agricultural purchases, tepid commitments on oil, and some directional language about opening microchip sales. That is not the catalyst a tape sitting at record highs was paying for.

The setup into the meeting was a coiled spring. Stocks ran into Thursday on the assumption that Beijing would hand Washington something concrete on H200 licenses or rare earths. When the joint readout produced neither, the unwind started in pre-market and accelerated through the cash session.

Yields Did Most of the Real Damage

Underneath the headline narrative, the cleaner story is rates. A global bond selloff drove the US 10-year yield to roughly 4.6% as inflation jitters and elevated oil prices forced traders to reprice central-bank trajectories. That is the kind of move that mechanically punishes long-duration equity — which today means AI infrastructure names trading at AI infrastructure multiples.

The index closed at 7,408.50, down 1.24% on the day, with the Nasdaq down 1.54% and the Dow off 537 points. Volatility wasn't from a single shock — it was the rates piece, the China piece, and a fresh Iran complication stacking on top of each other in the same session.

Chip Carnage Carried the Tape Lower

The damage was concentrated where you'd expect when both the China headline and the rates headline cut the same way. Intel fell more than 6%, AMD lost 5.7%, Micron shed 6.6%, and Nvidia dropped 4.4%. Cerebras — which had jumped 68% on its Thursday Nasdaq debut — gave back 10% in a single session. Broadcom, Arm, Corning, and Eaton also took meaningful hits as the AI complex coughed up recent gains.

This was the first session in weeks where the AI bid actually broke. With semis carrying a disproportionate share of S&P 500 weight, a sector-specific drawdown of this magnitude is enough on its own to drag the index lower even before you layer on financials and industrials selling off in sympathy with rising yields.

Iran Stacked On Top

The third leg was geopolitical. Trump rejected a proposed framework aimed at easing tensions with Iran, reviving fears of disruption to Middle Eastern shipping lanes and pushing oil prices higher into the close. Higher crude feeds directly back into the inflation-and-yields story that was already doing the heavy lifting in equities — a closed loop where every input reinforces the others.

For a tape pricing in cooler oil, a successful summit, and a stable rate path, all three premises got challenged in the same 24 hours. A 1.55% drawdown on the HIP-3 SP500 perp is what that looks like in real time.