US stocks fell sharply Thursday on worries about a toxic cocktail for financial markets, one where inflation remains stubbornly high but the economy's growth flags, per the AP. A drop for Facebook parent Meta Platforms, one of Wall Street's most influential stocks, also dragged the market lower.
- The Dow fell 375 points, or 0.9%, to 38,085.
- The S&P 500 fell 23 points, or 0.4%, to 5,048.
- The Nasdaq fell 100 points, or 0.6%, to 15,611.
A soft GDP report began the day's trouble. Lower-than-expected economic growth and higher-than-expected inflation is "a bit of a slap in the face to those hoping for a 'no landing' scenario," said Brian Jacobsen, chief economist at Annex Wealth Management. "Things can change a lot from one quarter to the next, so it's too early to say the Fed has failed, but this doesn't help their cause." Treasury yields climbed immediately after the economic report's release as traders pared bets for cuts to rates this year by the Federal Reserve. Meanwhile, Meta dropped about 10% after its revenue forecast fell below expectations.
Elsewhere, Southwest Airlines fell about 8% after the carrier reported worse results for the first quarter than analysts expected. Textron tumbled 9% after the maker of Bell helicopters and Cessna jets reported weaker profit and revenue than forecast. Caterpillar sank 6% despite reporting stronger profit than expected. On the winning side, Carrier Global jumped 8% after reporting stronger earnings than expected after wringing more operating profit out of each $1 in revenue.
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