Wall Street closes a record-breaking week with a quiet finish

NEW YORK (AP) — Wall Street closed its third winning week in the last four with a quiet finish on Friday.

The S&P 500 edged down by a whisper, less than 0.1%, after setting its all-time high the day before. The Dow Jones Industrial Average fell 142 points, or 0.3%, and the Nasdaq composite edged up by less than 0.1% to add its own record.

Norfolk Southern chugged 2.5% higher after an AP source said it’s talking with Union Pacific about a merger to create the largest railroad in North America, one that would connect the East and West coasts. Any such deal, though, would likely face tough scrutiny from U.S. regulators. Union Pacific’s stock fell 1.2%.

The heaviest weight on the market, meanwhile, was Netflix, which fell 5.1% despite reporting a stronger-than-expected profit. Analysts said it wasn’t a surprise given the stock had already soared 43% for the year so far coming into the day, six times more than the gain for the S&P 500.

American Express likewise delivered a better-than-expected profit report, but its stock lost 2.3%. Analysts pointed to slowing growth in some underlying trends, such as the number of cards it issued.

Exxon Mobil sank 3.5% and also tugged on the market. It had been challenging Chevron’s $53 billion deal to buy Hess, but an arbitration ruling in Paris about Hess assets off Guyana’s coast allowed the buyout to go through. Chevron fell 0.9% after losing an early gain.

Stronger-than-expected profit reports for the spring did help several stocks rally. Charles Schwab climbed 2.9%, Regions Financial jumped 6.1% and Comerica added 4.6%.

All told, the S&P 500 slipped 0.57 to 6,296.79 points. The Dow Jones Industrial Average dropped 142.30 to 44,342.19, and the Nasdaq composite rose 10.01 to 20,895.66.

In the bond market, Treasury yields eased after a report suggested U.S. consumers may be feeling less fearful about coming inflation. They’re bracing for inflation of 4.4% in the year ahead, down from last month’s projection of 5%, according to preliminary results from a University of Michigan survey.

That’s important because expectations for high inflation can feed into behaviors that create a vicious cycle that keeps inflation high. Overall sentiment among consumers, meanwhile, was a hair better than economists expected but still well below its historical average.

“Consumers are unlikely to regain their confidence in the economy unless they feel assured that inflation is unlikely to worsen, for example if trade policy stabilizes for the foreseeable future,” according to Joanne Hsu, the survey’s director.

The yield on the 10-year Treasury sank to 4.42% from 4.47% late Thursday. The two-year Treasury yield, which more closely tracks expectations for what the Federal Reserve will do with its short-term rates, also dropped. It fell to 3.87% from 3.91%.

A top Fed official, Gov. Chris Waller, said late Thursday that the Fed should cut its overnight interest rate as soon as its next meeting in a couple weeks. That follows sharp criticism from President Donald Trump, who has been castigating the Fed for holding interest rates steady this year instead of cutting them, as it did late last year.

Lower rates could give the economy a boost, and Trump has implied they could help the U.S. government save money on its debt payments, though that’s uncertain. The interest rates Washington has to pay on its longer-term debt can depend more on what bond investors think than on what the Fed does, and they can even move in opposite directions.

The chair of the Fed, meanwhile, has been insisting that he wants to see more data about how Trump’s tariffs will affect the economy and inflation before the Fed makes its next move. The downside of lower interest rates is that they can give inflation more fuel, and prices may already be starting to feel the upward effects of tariffs.

Traders on Wall Street think it’s much more likely that the Fed will resume cutting interest rates in September, rather than later this month, according to data from CME Group.

In stock markets abroad, indexes were mixed across Europe and Asia. Hong Kong’s Hang Seng jumped 1.3%, but Tokyo’s Nikkei 225 slipped 0.2% ahead of an election for the upper house of parliament on Sunday that could wipe out the ruling coalition’s upper house majority.

This version corrects the change in the Hang Seng index in Hong Kong to 1.3%.

AP Writers Teresa Cerojano and Matt Ott contributed.

Trader Peter Mancuso works on the floor of the New York Stock Exchange, Friday, July 18, 2025. (AP Photo/Richard Drew)

Traders James Bodner, foreground, and Christopher Lagana work on the floor of the New York Stock Exchange, Friday, July 18, 2025. (AP Photo/Richard Drew)

Trader Robert Charmak works on the floor of the New York Stock Exchange, Friday, July 18, 2025. (AP Photo/Richard Drew)

A vendor displays souvenirs on the street in front of the New York Stock Exchange in New York, Monday, July 14, 2025. (AP Photo/Seth Wenig)

James Matthews works on the floor at the New York Stock Exchange in New York, Wednesday, July 16, 2025. (AP Photo/Seth Wenig)

Currency traders watch monitors near a screen showing the Korea Composite Stock Price Index (KOSPI), top left, and the foreign exchange rate between U.S. dollar and South Korean won, top center, at the foreign exchange dealing room of the Hana Bank headquarters in Seoul, South Korea, Friday, July 18, 2025. (AP Photo/Ahn Young-joon)

Currency traders work near a screen showing the Korea Composite Stock Price Index (KOSPI), top left, and the foreign exchange rate between U.S. dollar and South Korean won, top center, at the foreign exchange dealing room of the Hana Bank headquarters in Seoul, South Korea, Friday, July 18, 2025. (AP Photo/Ahn Young-joon)

Currency traders watch monitors near a screen showing the Korea Composite Stock Price Index (KOSPI), top left, and the foreign exchange rate between U.S. dollar and South Korean won at the foreign exchange dealing room of the Hana Bank headquarters in Seoul, South Korea, Friday, July 18, 2025. (AP Photo/Ahn Young-joon)

DUBAI, United Arab Emirates (AP) — Nationwide protests in Iran sparked by the Islamic Republic's ailing economy are putting new pressure on its theocracy as it has shut down the internet and telephone networks.

Tehran is still reeling from a 12-day war launched by Israel in June that saw the United States bomb nuclear sites in Iran. Economic pressure, which has intensified since September when the United Nations reimposed sanctions on the country over its atomic program, has sent Iran's rial currency into a free fall, now trading at over 1.4 million to $1.

Meanwhile, Iran's self-described “Axis of Resistance” — a coalition of countries and militant groups backed by Tehran — has been decimated since the start of the Israel-Hamas war in 2023.

A threat by U.S. President Donald Trump warning Iran that if Tehran “violently kills peaceful protesters” the U.S. “will come to their rescue," has taken on new meaning after American troops captured Venezuelan President Nicolás Maduro, a longtime ally of Tehran.

“We're watching it very closely,” Trump said Sunday. “If they start killing people like they have in the past, I think they're going to get hit very hard by the United States.”

Here's what to know about the protests and the challenges facing Iran's government.

More than 390 protests have taken place across all of Iran’s 31 provinces, the U.S.-based Human Rights Activists News Agency reported Friday. The death toll had reached at least 42, it added, with more than 2,270 arrests. The group relies on an activist network inside of Iran for its reporting and has been accurate in past unrest.

Understanding the scale of the protests has been difficult. Iranian state media has provided little information about the demonstrations. Online videos offer only brief, shaky glimpses of people in the streets or the sound of gunfire. Journalists in general in Iran also face limits on reporting such as requiring permission to travel around the country, as well as the threat of harassment or arrest by authorities. The internet shutdown has further complicated the situation.

But the protests do not appear to be stopping, even after Supreme Leader Ayatollah Ali Khamenei on Saturday said “rioters must be put in their place.”

The collapse of the rial has led to a widening economic crisis in Iran. Prices are up on meat, rice and other staples of the Iranian dinner table. The nation has been struggling with an annual inflation rate of some 40%.

In December, Iran introduced a new pricing tier for its nationally subsidized gasoline, raising the price of some of the world’s cheapest gas and further pressuring the population. Tehran may seek steeper price increases in the future, as the government now will review prices every three months. Meanwhile, food prizes are expected to spike after Iran’s Central Bank in recent days ended a preferential, subsidized dollar-rial exchange rate for all products except medicine and wheat.

The protests began in late December with merchants in Tehran before spreading. While initially focused on economic issues, the demonstrations soon saw protesters chanting anti-government statements as well. Anger has been simmering over the years, particularly after the 2022 death of 22-year-old Mahsa Amini in police custody that triggered nationwide demonstrations.

Iran's “Axis of Resistance," which grew in prominence in the years after the 2003 U.S.-led invasion and subsequent occupation of Iraq, is reeling.

Israel has crushed Hamas in the devastating war in the Gaza Strip. Hezbollah, the Shiite militant group in Lebanon, has seen its top leadership killed by Israel and has been struggling since. A lightning offensive in December 2024 overthrew Iran’s longtime stalwart ally and client in Syria, President Bashar Assad, after years of war there. Yemen's Iranian-backed Houthi rebels also have been pounded by Israeli and U.S. airstrikes.

China meanwhile has remained a major buyer of Iranian crude oil, but hasn't provided overt military support. Neither has Russia, which has relied on Iranian drones in its war on Ukraine.

Iran has insisted for decades that its nuclear program is peaceful. However, its officials have increasingly threatened to pursue a nuclear weapon. Iran had been enriching uranium to near weapons-grade levels prior to the U.S. attack in June, making it the only country in the world without a nuclear weapons program to do so.

Tehran also increasingly cut back its cooperation with the International Atomic Energy Agency, the U.N.'s nuclear watchdog, as tensions increased over its nuclear program in recent years. The IAEA's director-general has warned Iran could build as many as 10 nuclear bombs, should it decide to weaponize its program.

U.S. intelligence agencies have assessed that Iran has yet to begin a weapons program, but has “undertaken activities that better position it to produce a nuclear device, if it chooses to do so.”

Iran recently said it was no longer enriching uranium at any site in the country, trying to signal to the West that it remains open to potential negotiations over its atomic program to ease sanctions. But there's been no significant talks in the months since the June war.

Iran decades ago was one of the United States’ top allies in the Mideast under Shah Mohammad Reza Pahlavi, who purchased American military weapons and allowed CIA technicians to run secret listening posts monitoring the neighboring Soviet Union. The CIA fomented a 1953 coup that cemented the shah’s rule.

But in January 1979, the shah fled Iran as mass demonstrations swelled against his rule. Then came the Islamic Revolution led by Ayatollah Ruhollah Khomeini, which created Iran’s theocratic government.

Later that year, university students overran the U.S. Embassy in Tehran, seeking the shah’s extradition and sparking the 444-day hostage crisis that saw diplomatic relations between Iran and the U.S. severed.

During the Iran-Iraq war of the 1980s, the U.S. backed Saddam Hussein. During that conflict, the U.S. launched a one-day assault that crippled Iran at sea as part of the so-called “Tanker War,” and later shot down an Iranian commercial airliner that the U.S. military said it mistook for a warplane.

Iran and the U.S. have seesawed between enmity and grudging diplomacy in the years since. Relations peaked with the 2015 nuclear deal, which saw Iran greatly limit its program in exchange for the lifting of sanctions. But Trump unilaterally withdrew America from the accord in 2018, sparking tensions in the Mideast that intensified after Hamas' Oct. 7, 2023, attack on Israel.

FILE -A student looks at Iran's domestically built centrifuges in an exhibition of the country's nuclear achievements, in Tehran, Iran, Wednesday, Feb. 8, 2023. (AP Photo/Vahid Salemi, File)

FILE - An Iranian security official in protective clothing walks through part of the Uranium Conversion Facility just outside the Iranian city of Isfahan, on March 30, 2005. (AP Photo/Vahid Salemi, File)

FILE - A customer shops at a supermarket at a shopping mall in northern Tehran, on Sept. 28, 2025. (AP Photo/Vahid Salemi, File)

FILE - Current and pre-revolution Iranian banknotes are displayed by a street money exchanger at Ferdowsi square, Tehran's go-to venue for foreign currency exchange, in downtown Tehran, Iran, on Aug. 28, 2025. (AP Photo/Vahid Salemi, File)

FILE - People cross the Enqelab-e-Eslami (Islamic Revolution) street in Tehran, Iran, on Sept. 27, 2025. (AP Photo/Vahid Salemi, File)

FILE - Protesters march on a bridge in Tehran, Iran, on Dec. 29, 2025. (Fars News Agency via AP, File)

People wave national flags during a ceremony commemorating the death anniversary of the late commander of the Iran's Revolutionary Guard expeditionary Quds Force, Gen. Qassem Soleimani, who was killed in a U.S. drone attack in 2020 in Iraq, at the Imam Khomeini grand mosque in Tehran, Iran, Thursday, Jan. 1, 2026. (AP Photo/Vahid Salemi)