Wall Street Slips as Middle East Inflation Fears Hit AI Stock Rally

The odds of the Federal Reserve hiking interest rates by 25 basis points in December have more than doubled over the past week.

A street sign for Wall Street is seen outside the New York Stock Exchange in Manhattan, New York City, on Dec. 28, 2016. Andrew Kelly/Reuters

Wall Street’s main indexes fell on Friday amid fears that the Middle East conflict could reignite inflation, threatening to stall the AI-driven rally that has powered U.S. stocks.

At 10 a.m. ET, technology was the biggest drag on the S&P 500, as eight of the index’s 11 major sectors traded lower.