Stocks in the US plummet following Meta’s reality check and weak GDP report

Stocks took a hit on Thursday as concerns about the US economy grew following a lower-than-expected reading on US GDP for the first quarter. The Nasdaq Composite fell by roughly 1.3%, with tech stocks leading the decline. Meta’s revenue forecast spooked investors, causing its shares to plummet by as much as 15%.

The S&P 500 and Dow Jones Industrial Average also saw losses of 0.9% and 1.3%, respectively. The disappointing GDP growth of 1.6% in the first quarter, well below the expected 2.5%, raised questions about the Federal Reserve’s interest rate campaign.

Treasury yields surged after the GDP print, with the benchmark 10-year yield reaching its highest levels of the year at around 4.73%. Meta’s plans to spend up to $10 billion on AI infrastructure investments added to investor concerns, leading to a broader decline in tech stocks.

In addition to Meta, other tech giants like Microsoft, Alphabet, and Amazon also saw their shares drop by more than 3%. Caterpillar shares sank by as much as 7% after the heavy equipment maker reported weakness in Europe and softening economic conditions in the Asia-Pacific region.

Investors will now turn their attention to the March reading of the Personal Consumption Expenditures index, the Fed’s favored inflation gauge, set for release on Friday. The market’s reaction to these economic indicators will be closely watched as investors navigate the current economic landscape.