On the evening of the 25th Beijing time, US stocks opened lower on Thursday. Financial reports such as Meta and Caterpillar and poor US GDP data for the first quarter put pressure on stock indexes. After the GDP data was released, the US 10-year Treasury yield rose above 4.7% to a 5-month high, and the 2-year Treasury yield once again reached the 5% mark.
As of press release, the NASDAQ is down 1.86%, the S&P 500 is down 1.32%, and the Dow is down 1.48%.
A number of large companies had poor earnings reports, which overshadowed the US stock earnings season.
Major technology stocks such as Alphabet, the parent company of Microsoft and Google, will release financial reports after closing on Thursday. Meta Platforms' financial report raised concerns about the performance of technology stocks.
Thierry Wizman, Macquarie's global forex and interest rate strategist, said: “Despite all the attention paid to generative artificial intelligence (AI) over the past nine months, Meta failed to deliver on its revenue growth forecast in the first quarter. This raises questions about whether monetizing this technology is as easy as traders being guided by management?”
Thursday's economic data added to the market's disappointment.
The US Bureau of Economic Analysis (Bureau of Economic Analysis) reported on Thursday that after seasonal adjustments, the US gross domestic product (GDP) grew 1.6% year-on-year in the first quarter, lower than the increase (2.4%) predicted by economists surveyed by Dow Jones. GDP growth in the fourth quarter of last year was revised from 3.4% to 3.9%.
Another data shows that the initial month-on-month discount rate of the US core PCE price index for the first quarter was 3.7%, estimated at 3.4%, and the previous value was 2.0%.
According to the analysis, GDP data showed that the US economy slowed significantly in the first quarter due to increased inflation and cooling consumer and government spending.
According to preliminary estimates by the US government, the main growth engine of the US economy (the initial quarterly rate of actual personal consumption expenditure) grew by only 2.5%, while the potential inflation index (the initial value of the US core PCE price index annualized quarterly rate in the first quarter) rose by 3.7%, which was higher than expected.
The US Department of Labor reports that the number of people claiming unemployment benefits for the first time last week was 207,000, estimated at 215,000, compared to 212,000 previously.
Including GDP data, this week's important economic data will provide information for market research on the Federal Reserve's interest rate policy path.
Quincy Crosby, chief global strategist at LPL Financial, said, “Weak GDP in the first quarter may once again change the schedule for the Federal Reserve to begin an easing cycle. The possibility of interest rate cuts in July will resurface. If the PCE report to be released tomorrow also shows that the downward path of inflation has begun to pick up again, it may become a catalyst for the market to decline.”
Meanwhile, Paul Dietrich, the chief investment strategist at the bank's B.Riley Wealth Management Company, warned that US stocks may face a sharp drop of up to 44%, and he suggested that investors should withdraw from the market early to benefit.
According to CME's FedWatch (FedWatch) tool, federal funds futures trading shows that traders predict that the Fed's first rate cut will be postponed until December.
Individual stocks in focus
Star technology stocks generally fell, Meta fell about 15%, Microsoft, Amazon, and Google fell more than 4%, and Nvidia and Tesla fell slightly.
Most popular Chinese securities declined, with TSMC falling more than 2%, Pinduoduo and NIO falling more than 1%, and Ali, JD, and Baidu falling slightly.
Digital currency concept stocks collectively weakened, with CleanSpark falling more than 7%, Marathon Digital and Riot Platforms falling nearly 6%, and Coinbase and MicroStrategy falling about 3%.
In terms of individual stocks,$Microsoft (MSFT.US)$,$Alphabet-A (GOOGL.US)$It fell more than 4%, and the results will be announced after the market.
$Meta Platforms (META.US)$The sharp drop was about 15%, and the Q2 revenue guidance fell short of expectations.
$IBM Corp (IBM.US)$It fell more than 8%, and Q1 revenue fell short of expectations.
$Trump Media & Technology (DJT.US)$Up nearly 9%, Trump is expected to receive $1.3 billion in stock rewards.
editor/tolk