Wall Street tumbles; chip stocks slide as strong jobs data spurs rate hike fears

U.S. stocks fell sharply on June 5, 2026, after a blowout May jobs report drove Treasury yields higher and cemented expectations for a Federal Reserve interest rate hike later this year. The S&P 500 dropped 1.4%, the Nasdaq Composite slumped 2.37%, and the Dow Jones Industrial Average lost 0.55%. Nonfarm payrolls rose by 172,000 jobs in May, far exceeding the 85,000 forecast. The data pushed yields up as traders priced in a near-certain 25-basis-point rate increase by year-end. Chipmakers led the selloff, with Nvidia (NVDA) losing 2.5% and the Philadelphia Semiconductor Index tumbling 5% after a 92% rally so far this year. Tech shares fell for a third straight session, while investors rotated into defensive sectors such as consumer staples. Lululemon Athletica (LULU) slumped 8% after cutting its annual profit forecast, while Cooper Companies (COO) rose 8.5% on better-than-expected quarterly results. S&P Global said it would not change index eligibility rules, effectively delaying a swift S&P 500 entry for Elon Musk’s SpaceX after its anticipated IPO.