Finance

Corporate earnings report results from major tech firms displayed stark differences in financial outcomes. Shares of Microsoft surged significantly after reporting stronger-than-expected revenue and maintaining steady capital expenditure guidance. Conversely, Meta Platforms faced downward pressure as investors reacted to escalating capital spending forecasts and a decline in free cash flow dedicated to its artificial intelligence infrastructure.

Government borrowing costs remained highly elevated as the Federal Reserve chose to maintain its benchmark interest rate at its current range. Despite some internal opposition from committee members pushing for a rate hike, Chairman Kevin Warsh signaled that the central bank remains focused on curbing inflation. Consequently, the 30-year Treasury yield hovered near its highest level since 2007, reflecting investor anxiety over stubborn price pressures and resilient economic data.

The latest government data showed that the domestic economy grew at an annualized rate of 1.5% during the second quarter, underperforming consensus forecasts. This deceleration was influenced partly by a widening trade deficit linked to heavy spending on artificial intelligence infrastructure. Meanwhile, secondary reports indicated that the weekly initial jobless claims dropped slightly to 197,000, underscoring continued strength in the labor market.