Oversold tech roars back
QQQ•Tech rebound lifts U.S. stocks
U.S. stocks snapped back on Thursday as Microsoft's stellar forecasts soothed concerns about massive AI spending by companies, while investors also parsed fresh GDP and inflation data a day after the Federal Reserve's rate decision.
MSFT surged more than 15% for its biggest daily percentage gain since October 2008 after the technology company forecast quarterly sales and cloud growth above expectations. It also reported capital expenditures below estimates and said it expects to keep generating cash through its fiscal 2027, which has just begun.
However, in a sign that AI concerns are far from over, Meta Platforms META.O tumbled 8% after the social media heavyweight reported a 91% drop in second-quarter free cash flow, indicating the financial strain of its costly AI buildout.
U.S. economic growth slowed in the second quarter as the trade deficit widened. The economy grew at a 1.5% rate, slower than estimates of 2.1% growth, data showed. A separate report showed U.S. inflation eased in June.
