The Standard & Poor's 500 index fell 1.6% this week, led by technology stocks, amid concerns about whether excitement over artificial intelligence has been overdone in the US.

The S&P 500 ended the week at 7,457.69 and is down 0.6% for July but up 8.9% for the year.

Worries about the U.S. technology sector flared as China's Moonshot AI, which is backed by Alibaba (BABA), released an AI model that it says outperforms some US-based systems.

Continued conflict in the Middle East also weighed as crude oil futures climbed. Iran said it had targeted US military forces in Syria and Bahrain in a broadening of the scope of its attacks in the Middle East.

Economic data showed US consumer prices declined by more than expected in June while producer prices unexpectedly fell. The drop in producer prices came amid a steep decline in the cost of energy products. Still, US industrial production rose by less than expected in June as manufacturing output stalled, Federal Reserve data showed Friday.

The technology sector fell 3.8%, followed by a 2.4% loss in communication services and declines of 1.4% each in industrials and materials. Consumer discretionary and utilities also edged lower.

The decliners in the technology sector included shares of Applied Materials (AMAT), which fell 12% on the week, and Cadence Design Systems (CDNS), down 14%.

In communication services, shares of Netflix (NFLX) shed 6%. The streaming company's second-quarter revenue missed Wall Street's estimates while Q3 guidance lagged market expectations. The company also said it will switch to releasing its engagement report annually, rather than semi-annually.

On the upside, energy climbed 5%, while real estate rose 2.3% and consumer staples added 1.4%. Financials and health care were also higher.

The climb in energy came as crude oil futures rose as Iran widened its attack to a desalination plant in Kuwait. Gainers included shares of Exxon Mobil (XOM), up 6.1%, and Chevron (CVX), up 6.2%.

Next week's earnings calendar features Google parent Alphabet (GOOGL, GOOG), Tesla (TSLA), Philip Morris International (PM), GE Vernova (GEV), Texas Instruments (TXN), International Business Machines (IBM), AT&T (T), Intel (INTC) and American Express (AXP).

Economic data will include June new home sales and the July US Flash Manufacturing PMI, a gauge of the manufacturing sector's health.