• Stocks fell sharply on Thursday, dragged down by technology.

• Shares of Microsoft and Meta fell on renewed concerns about AI spending.

• Jobless claims fell more than expected while the Fed’s preferred inflation gauge edged closer to 2%.

US stocks fell sharply on Thursday, with the tech-heavy Nasdaq sliding almost 3% as Meta and Microsoft suffered heavy losses.

The tech selloff was triggered by the latest earnings from large-cap companies, which mostly beat estimates but disappointed investors in other areas and heightened concerns about massive investments in artificial intelligence .

The S&P 500 fell nearly 2% while the Dow Jones Industrial Average lost more than 370 points.

Here’s where the US indexes stood at the 4:00 p.m. closing bell on Thursday:

Much of the disappointment is due to the directions of the tech giants.

Microsoft said it expects current quarter revenue to be between $68.1 billion and $69.1 billion, while analysts polled by FactSet had expected $69.89 billion. The company attributed the slowdown in part to its investment in cloud computing capacity to meet demand for AI.

Microsoft shares fell 6% to close at $406.35.

Meta, meanwhile, said it expects capital spending to increase over the next year as it continues to invest in AI, and raised its investment forecast for this year at a range of $38 billion to $40 billion, $37 billion to $40 billion.

However, UBS analysts remain convinced that the increased spending will bear fruit.

“As Meta continues to report a significant increase in CapEx for 2025, the results also highlighted multiple offsets to illustrate what investments will begin to deliver – as we highlighted previously, the easiest element to observe is the absolute increase in revenues “Dollar growth in 2024 which currently stands at around $28 billion and almost matches the pandemic-induced acceleration from 2021 of around $29 billion” , analysts wrote in a Thursday note.

Meta stock lost 4% to close at 567.68%.

Also Thursday, investors digested the Federal Reserve’s preferred inflation gauge. The personal consumption expenditure index fell to 2.1% year-on-year in September from 2.2% in August, but the core index, which excludes volatility in food and energy prices, was higher than expected at 2.7%.

At the same time, jobless claims fell more than expected to 216,000 last week, a drop of 12,000 from the previous week. Economists expected 230,000 claims.

The story continues