[Asia Economy New York=Special Correspondent Joselgina] Meta Platforms, the parent company of Facebook, surged by a staggering 23% in a single day, accelerating the big tech rally on the New York Stock Exchange.
On the 2nd (local time) at the New York Stock Exchange, the Nasdaq index closed at 12,200.82, up 3.25% from the previous session. This is the highest level since September last year and the largest daily gain since November 30. On the same day, the S&P 500 index, which is centered on large-cap stocks, rose 1.47% to close the trading session.
Except for the Dow Jones index, the New York Stock Exchange showed strength from the early session due to the big tech rally. With growing expectations that the U.S. Federal Reserve (Fed) will soon halt the interest rate hike cycle, Meta led the rally. Meta jumped 23.28% on the day, fueled by better-than-expected strong earnings and news of a $40 billion share buyback. At one point during the session, its market capitalization surpassed $500 billion. The New York Times (NYT) reported, "It added $100 billion in market capitalization in one day," noting that "this is equivalent to the entire market cap of Citigroup."
Meta's surge acted as a positive catalyst, lifting the stock prices of other big tech companies alongside expectations of the Fed pausing rate hikes. Meta's sharp rebound, after being the most prominent tech stock to plunge last year, was seen as a kind of signal flare. Alphabet, Amazon, and Apple, which were set to release earnings after the market close, ended the regular session up 7.28%, 7.38%, and 3.71%, respectively. Microsoft rose 4.69%, and Tesla increased by 3.78%.
Among market experts, there is an analysis that big tech earnings will determine the market direction for the time being. Although the Fed raised the benchmark interest rate by 0.25 percentage points the day before, slowing the pace of tightening, economic uncertainties remain widespread, so investors' attention is expected to focus on big tech earnings guidance.
However, the so-called 'Triple A' earnings released immediately after the market close fell short of expectations. Apple, the company with the largest market capitalization, recorded a quarterly sales decline for the first time in four years. Fourth-quarter sales were $117.15 billion, down 5.49% year-over-year, missing Wall Street estimates. Alphabet also posted an earnings per share (EPS) of $1.05 due to a hit to its digital advertising business. Amazon's sales met expectations, but growth in its cloud computing business slowed. Amazon Web Services (AWS) revenue growth rate shrank from 40% to 20%. The stocks of these companies were trading down 3-4% in after-hours trading as of 7:45 p.m. (local time) on the same day.
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