Scott Kanowsky
5 min read
Investing.com – Futures linked to the main U.S. stock indices slip, as traders pore through earnings from Facebook-owner Meta Platforms and Elon Musk-led electric car giant Tesla. Meta shares advance in extended-hours trading after the tech behemoth unveils better-than-expected quarterly revenue and robust current-quarter guidance. Shares of Tesla fall on a lower annual sales target, while some insiders reportedly express concerns over regulatory scrutiny of a possible merger between Tesla and Musk’s rocket firm SpaceX.
1. Futures dip
U.S. stock futures pointed lower on Thursday. By 03:08 ET (07:08 GMT), the S&P 500 futures contract had fallen by 75 points, or 1.0%, Nasdaq 100 futures had dropped by 510 points, or 1.7%, and Dow futures had retreated by 283 points, or 0.5%.
The main averages on Wall Street advanced in the prior session, buoyed by strong results from Musk’s rocket company SpaceX and server maker Super Micro Computer. The returns helped to assuage some recent concerns around the sustainability of the artificial intelligence trade, although analysts at Deutsche Bank flagged that the decline in Nasdaq futures could be a sign that not all investors were reassured.
Jitters have surrounded the AI sector for several days, triggered by a combination of heavy debt-fueled spending on AI infrastructure and elevated borrowing costs. Roller-coaster movements in AI-exposed stocks have mirrored shifting sentiment around AI, especially after fresh corporate returns appear to indicate that demand for the nascent technology remains solid.
2. Meta rises after revenue beat
Shares of Meta crept higher in extended-hours trading after the Instagram-owner unveiled higher-than-anticipated third-quarter revenue and announced plans to create a new class of nonvoting stock to raise capital for its AI ambitions.
Along with resilience in its core advertising business, the well-received debut of Meta’s Muse AI assistant in September has helped bolster returns during a time when the tech titan is investing hundreds of billions of dollars into the AI race. Hopes have been high that Muse will eventually add $28.5 billion of incremental revenue by 2030, according to Truist Securities projections cited by the Wall Street Journal.
CEO Mark Zuckerberg said in a post-earnings call that roughly a fourth of people who have set up Muse use it on “any given day,” particularly for shopping. Zuckerberg added that Meta is aiming to create a “large-scale Muse network,” even though the app has been blocked on some websites, such as Amazon.com.
