US stock markets fell on Thursday after US Gross Domestic Product (GDP) rose less than expected in the first quarter.
The stock market linked to the Dow Jones Industrial Average fell 419 points or 1.08%. S&P 500 futures declined 1.1%, and Nasdaq 100 futures fell 1.47%.
Traders reviewed the first-quarter reading of US GDP, which posted growth of 1.6% in the first quarter, according to the Bureau of Economic Analysts on Thursday. Economists interviewed by Dow Jones predict that real GDP will reach 2.4%.
In addition to the weak growth rate for the quarter, the report showed that consumer prices rose at a rate of 3.4%, well above the previous quarter's 1.8% increase. This raises concerns about continued inflation and questions whether the Federal Reserve will be able to cut rates anytime soon.
These data will likely provide guidance to the central bank in its interest rate policy. Trading in Fed funds shares indicated the first tapering could happen at the Fed's September meeting, according to the CME FedWatch Tool.
Shares of Meta tumbled 12% in pre-market trading after the social media company released earnings guidance for the second quarter. This could push it to the stock's biggest one-day decline since October 2022. International Business Machines (IBM) also fell 8% after missing consensus estimates for first-quarter earnings.
The Meta report raises concerns ahead of another big tech release. Microsoft and Alphabet are scheduled to announce earnings after the close Thursday.
However, iCapital's Chief Investment Strategist, Anastasia Amoroso, thinks earnings look strong enough to drive the stock's move.
