Wall Street traded lower on Thursday, pressured by a sharp post-earnings selloff in Microsoft and broader weakness across software stocks. At the same time, gold prices paused a historic rally that had pushed the metal close to $5,600 per ounce, as traders moved to lock in profits.
Earnings remained a central focus for investors. Apple was scheduled to report results after the closing bell, while Meta drew a positive market reaction following its earnings release.
By 11:37 ET (16:37 GMT), the S&P 500 was down 1.1% at 6,904.01, while the Dow Jones Industrial Average slipped 0.3% to 48,872.42. The NASDAQ Composite led losses, falling 2% to 23,375.32. The S&P 500 had briefly crossed the 7,000 mark for the first time on Wednesday.
Keith Lerner, chief investment officer and market strategist at Truist, said the pullback was largely driven by weakness in technology shares following mixed earnings. However, he noted that selling pressure remained relatively contained beneath the surface, with the NYSE advance-decline ratio showing roughly 1.5 decliners for every advancer.
Lerner added that the S&P 500 Equal-Weighted Index, often viewed as a proxy for the average stock, was down just 0.16%, while gold and silver were experiencing sharp pullbacks after an exceptional run as profit-taking emerged.
Earnings drive diverging stock moves
Several members of the so-called Magnificent Seven reported earnings late Wednesday, producing mixed reactions in early trading.
Shares of Meta jumped after the Facebook owner forecast first-quarter revenue above expectations, citing resilient advertising demand and growing returns from its artificial intelligence investments. The company also announced plans to lift capital spending to as much as $135 billion this year, nearly doubling last year’s total as AI investment remains a dominant theme.
In contrast, Microsoft shares fell sharply. Although the company said spending on AI infrastructure exceeded expectations, investors were concerned about slightly slower growth in its Azure cloud division compared with the prior quarter. Microsoft’s results, along with those from SAP, weighed on software services stocks.
Companies such as Atlassian, Workday, and Intuit were among the biggest percentage decliners on the Nasdaq.
Elsewhere, Tesla shares gave up early gains and traded lower. The automaker topped fourth-quarter expectations but pointed to a strategic pivot toward artificial intelligence as pressure persists in its core automotive business.
Shares of IBM rose after the company beat estimates for revenue and profit, supported by rising demand for AI-driven software services. Caterpillar also advanced after reporting stronger-than-expected quarterly revenue, fueled by demand for energy equipment linked to AI-related infrastructure growth.
Fed decision steadies broader market outlook
The Federal Reserve held interest rates steady at 3.50%–3.75% on Wednesday, marking its first pause after three consecutive rate cuts.
In its statement, the Fed cited persistent inflation alongside solid economic growth and a stabilizing labor market, offering limited guidance on the timing of future policy moves.
Brian Storey, head of multi-asset strategies at Brinker Capital, said the central bank struck a slightly more optimistic tone, modestly upgrading its view of labor market conditions while showing less concern about inflation pressures.
Although the Fed did not update its rate projections, Storey noted growing alignment between policymakers and financial markets, with futures pricing in one to two rate cuts by year-end, reducing the risk of monetary policy disrupting equity markets later in the year.
Gold cools after record run as oil prices surge
Gold prices earlier climbed to a record high near $5,600 per ounce, extending gains after reports that Donald Trump was considering a new strike on Iran. The rally lost momentum in morning trade, with spot gold turning sharply lower as traders booked profits.
Silver prices also reversed course after hitting an all-time high near $122 per ounce. The broader precious metals rally has been fueled by rising geopolitical tensions, strong safe-haven demand, a weaker U.S. dollar, and uncertainty surrounding U.S. policy. Copper prices also reached record highs during the session.
Oil prices climbed sharply on fears that supply could be disrupted if Iran is targeted by U.S. military action. Brent crude rose 3.1% to $69.47 per barrel, while WTI crude gained 3.6% to $65.48 per barrel.
Both benchmarks have surged more than 10% this week, reaching their highest levels since June of last year.
