Stock market today: Nasdaq, S&P 500 sink as Meta, Microsoft revive Big Tech’s AI spending worries

Live10 updates

• Thu, October 31, 2024 at 5:45 PM GMT+1

  Big Tech leads declines, Nvidia falls 4%

  Technology stocks led the overall market declines on Thursday. The S&P 500 Technology Sector (XLK) ETF slid 2.8% by mid-session.

  AI chip heavyweight Nvidia (NVDA) was down more than 4% along with other semiconductor stocks.

  Among Big Tech’s decliners—software giant Microsoft (MSFT) fell more than 5% following its quarterly results. Social media company Meta (META) fell roughly 4% after indicating it will step up spending on AI infrastructure next year.

  Amazon (AMZN), set to report earnings after the bell, also dropped more than 3%.

  

• 

  Thu, October 31, 2024 at 5:15 PM GMT+1

  DJT stock extends double-digit plunge after worst day yet for Donald Trump’s company

  Trump Media & Technology Group stock (DJT) extended its double-digit declines on Thursday as the stock reversed sizable gains from earlier in the week. Shares fell around 15% and trading was briefly halted due to volatility.

  As Yahoo Finance’s Alexandra Canal reports, the massive swings come as the stock suffered its largest percent decline on Wednesday after shares plunged around 22%.

  Since Tuesday, more than $3 billion has been shaved from the company’s market cap, although the stock is still up roughly 130% from its September lows.

  Read more here.

• 

  Thu, October 31, 2024 at 4:51 PM GMT+1

  Super Micro drops another 14% as accounting questions weigh on AI highflyer

  Super Micro Computer (SMCI) stock dropped nearly 14%, extending declines of 33% in the prior session to erase all of its year-to-date gains, as some Wall Street analysts backed away from covering the stock after accounting firm Ernst & Young (EY) resigned during the company’s audit.

  On Thursday, Argus downgraded the server maker to Hold from Buy, with no price target. Meanwhile analysts at Needham and Wells Fargo suspended coverage of the company.

• 

  Thu, October 31, 2024 at 4:15 PM GMT+1

  Comcast considers spinning off cable networks ‘to play some offense’ amid industry turmoil

  Yahoo Finance’s Alexandra Canal reports:

  Comcast (CMCSA) said Thursday that it has started exploring spinning off its cable networks into a separate company. The development comes as the media industry undergoes massive disruption, with more consumers cutting the cord, or dropping their pay-TV packages.

  Comcast stock rose more than 2% on Thursday morning. Read more here.

• 

  Thu, October 31, 2024 at 3:39 PM GMT+1

  Losses accelerate as Nasdaq sinks 2%

  Stocks accelerated their losses on Thursday as the Nasdaq (^IXIC) dropped as much as 2% with technology sliding.

  Among the biggest laggards, Nvidia (NVDA) sank 4% while Microsoft (MSFT) and Broadcom (AVGO) also fell 4%.

  

• 

  Thu, October 31, 2024 at 3:00 PM GMT+1

  Stellantis Q3 revenue slumps but inventory is improving; ‘We’re grinding through a transition’ CFO says

  Yahoo Finance’s Pras Subramanian reports:

  Stellantis (STLA) reported third quarter revenue and shipments that missed estimates, though the company said it’s making “progress addressing operational issues.”

  The stock gained more than 3% in early trading on Thursday.

  Read more here.

• 

  Thu, October 31, 2024 at 2:31 PM GMT+1

  Tech stocks lead declines as Microsoft, Meta slide

  Tech stocks led the major averages lower on Thursday following quarterly results from social media giant Meta (META) and software maker Microsoft (MSFT).

  The tech-heavy Nasdaq Composite (^IXIC) sank 0.7%, while the S&P 500 (^GSPC) fell over 0.7%. The Dow Jones Industrial Average (^DJI) dropped roughly 0.5%.

  Meta said it would increase capital spending significantly in 2025, while Microsoft’s cloud growth forecast disappointed Wall Street as the company races to expand its AI infrastructure.

• 

  Thu, October 31, 2024 at 2:00 PM GMT+1

  Microsoft and Meta fall as spooked investors weigh hefty AI bills

  Meta (META) and Microsoft (MSFT) stocks sank premarket as investors weighed their hefty artificial intelligence expenditures against the time it will take to generate a return on their investment.

  Meta fell as much as 4.7% before paring losses, while Microsoft was down 3.6%. During their earnings reports the night before, both companies beat Wall Street’s expectations, but Microsoft’s weaker-than-expected sales guidance for the current quarter and Meta’s raised outlook on capital expenditures appeared to spook investors.

  Meta raised the lower end of its guidance range for full-year spending from $37 billion to $38 billion, and CFO Susan Li said the company expects “significant capital expenditure growth in 2025.” Microsoft indicated in its fiscal first quarter earnings reports that spending on general artificial intelligence infrastructure (e.g., AI chips) weighed on gross margins, which it expects to continue in the current period.

  Microsoft justified the spending by saying the demand for its AI products is real and that infrastructure spending is necessary to continue to meet that demand.

  “Roughly half of our cloud and AI-related spend continues to be for long-lived assets that will support monetization over the next 15 years and beyond,” said Microsoft CFO Amy Hood.

  Meta said it’s seeing “rapid adoption of Meta AI.”

  RBC Capital analyst Rishi Jaluria said to buy the dip on Microsoft: “While investors may be hung up on the optics of decelerating Azure growth paired with substantial CapEx, we see a path to upward revisions.”

  Analysts also reiterated their Buy ratings on Meta stock.

• 

  Thu, October 31, 2024 at 1:17 PM GMT+1

  Good morning. Here’s what’s happening today.

  Economic data: Core PCE index, (September); Initial & Continuing jobless claims, (week ending Oct. 26); Employment cost index, (third quarter); Challenger jobs cuts, (October); Personal income & Spending, (September)

  Earnings: Apple (AAPL), Amazon (AMZN), Conoco Phillips (COP), Estée Lauder (EL), Kellanova (K), Intel (INTC), Mastercard (MA), Norwegian Cruise Lines(NCLH), Peloton (PTON), Merck (MRK), SiriusXM (SIRI), Comcast (CMCSA); Uber (UBER)

  Here are some of the biggest stories you may have missed overnight and early this morning:

  Microsoft stock slides as investors weigh earnings

  Meta beats, but stock falls on heavy spending plans

  Peloton names former Apple exec as CEO to steer turnaround

  ‘Shadow campaigns’: Microsoft-Google legal feud heats up

  Merck beats Q3 expectations, but China Gardasil sales lag

  Tesla chipmaker STMicro trims revenue outlook for 3rd time

  Gold climbs to record amid US election jitters

• 

  Thu, October 31, 2024 at 11:18 AM GMT+1

  Starbucks new CEO chats with Yahoo Finance

  Starbucks (SBUX) shares are indicating a slightly higher open today despite more details about the dreadful quarter the company preannounced last week.

  And I will tell you why: new CEO Brian Niccol.

  I have known Niccol for about 10 years, going back to his time leading Taco Bell at Yum! Brands (YUM). One thing among many that I have noticed about him is how he really digs into problems and calmly articulates them — and an action plan — to team members and investors.

  That was the same Niccol who senior reporter Brooke DiPalma and I encountered last night in a 15-minute post-earnings call phone chat. Such calm under fire will prove to be a good thing for Starbucks, as it has many, many problems to address.

  Niccol seemingly has more knowledge about Starbucks in his first three months than the prior CEO gained in more than a year!

  He is wasting no time fixing things at Starbucks, as Brooke reports here.

  But here is one exchange I had with him on the phone regarding the need to slash the menu size by 25% or more. Cutting the Starbucks menu down is vitally important to driving a better business on the top and bottom lines.

  It’s good to see Niccol understand this (he made it a point to keep the Chipotle (CMG) menu small, carefully introducing a new item or two a year after thorough testing), as his predecessors never did.

  “I think there’s definitely opportunity for us to rationalize the menu. As I was talking to the folks that lead our product work, you would not have designed some of these products if we would have designed it first with the four-minute in-cafe experience in mind or recognizing the mobile order requirements. So the good news is we can go back with the lens of … are people even buying it? There’s a lot of things we have on the menu that are really kind of what I would call in the long tail. So you’re just not selling that many.”