U.S. stock markets surged after Microsoft and Meta Platforms reported quarterly earnings that significantly exceeded analysts' expectations.
Rise of Microsoft and Meta Stocks
Meta’s shares rose over 5% in after-hours trading following the release of quarterly results that exceeded estimates. Microsoft also showed strong performance, gaining nearly 7% due to robust revenue and profit figures in the third fiscal quarter.
Market Panic and Its Consequences
Despite the positive reports, the market showed pessimism earlier in the day. The S&P 500 dropped more than 2%, and the Dow fell over 780 points. Data from the Commerce Department showing a 0.3% decline in GDP also contributed to the panic, but traders chose to ignore these factors and began buying stocks aggressively.
Fed Expectations and Declining Trading Volumes
Traders now expect the Federal Reserve to cut interest rates by a full percentage point before the end of the year. However, recent remarks from Chair Jerome Powell and other Fed officials suggest that actions may be delayed. Trading volume also sharply declined, reaching 16.97 billion shares, below the 20-day average, indicating persistent fear among investors.
Thus, despite the encouraging reports from major tech companies, the market remains under pressure from negative economic data and uncertainty surrounding Fed policy.
