Stock market Sector Tumbles: Nasdaq Falls as Microsoft and Meta Earnings Spark Investor Concerns

 US stocks fell sharply on Thursday, led by the Nasdaq, after earnings reports from Meta and Microsoft raised concerns about rising costs related to artificial intelligence (AI). 

The Nasdaq Composite dropped 2.7%, while the S&P 500 fell nearly 1.9%, ending.

the month with slight losses. The Dow Jones Industrial Average also declined, dropping 0.9% on Thursday and experiencing a monthly loss.

This decline interrupted a five-month streak of gains for the S&P 500 and Dow. Investors were initially optimistic about Big Tech's potential to boost stocks, but 

the quarterly results from Meta and Microsoft, although beating expectations, indicated that both companies plan to increase their spending on AI. This raised worries about their profitability, leading to drops in their stock prices.

The negative sentiment extended to other tech giants like Amazon and Apple, which reported earnings after the market closed on Thursday. Nvidia, a leader in AI technology, also saw its shares decline by over 4.5%. 

After the market closed, Amazon's stock surged as it reported better-than-expected revenue and earnings. In contrast, Apple’s shares dipped slightly due to a one-time charge related to a legal decision in Europe that affected its earnings.

On the economic front, the latest Personal Consumption Expenditures (PCE) index was released, showing inflation in line with expectations, providing crucial data for the Federal Reserve ahead of its policy meeting next week. Additionally, initial jobless claims dropped to a five-month low of 216,000, which was lower than anticipated, with a significant jobs report due on Friday.

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