Today’s Market Recap: Nasdaq Drops 2.60%, Meta Slumps 7%, Oil Surges Past $113, Gold Plunges Toward $4,000

Tracking Market Trends

TradingKey - On October 22 Eastern Time, the three major US stock indices diverged, with the Nasdaq and S&P 500 Index dropping significantly, while the Dow closed slightly higher. Meta (META) earnings reignited market concerns over AI capital expenditures and return on investment, with tech and semiconductor stocks serving as the main drag. Meanwhile, the escalation of the Middle East situation drove up international oil prices, further disturbing market sentiment. However, most US stocks still recorded gains, as earnings performance from select consumer and defense companies provided support to the market.

As of the close, the Dow Jones Industrial Average rose 0.02% to 52,873.28; the S&P 500 Index fell 1.21% to 7,663.43; and the Nasdaq Composite Index declined 2.60% to 26,008.86, marking its largest single-day drop since June.

In terms of sectors and individual stocks, AI-related stocks came under pressure. Meta fell 6.98%, Tesla (TSLA) dropped 3.08%, and chip equipment maker Lam Research (LRCX) plummeted 11.76%. In contrast, Procter & Gamble (PG) rose 5.58%, and Lockheed Martin (LMT) gained nearly 7%, as earnings results drove select consumer and defense stocks higher against the trend.

In the bond market, US Treasury prices rose as capital shifted into safe-haven assets. The 10-year US Treasury yield fell by about 19 basis points to 4.953%, dropping back below 5% and recording its largest single-day decline since March 2023.

In commodities, international oil prices rose sharply. Brent crude rose 2.64% to close at $112.91; WTI crude gained 1.42% to close at $99.09. An attack by Houthi forces in Saudi Arabia prompted the market to reassess energy supply risks in the Middle East, pushing Brent crude to a roughly five-month high.

In precious metals, gold (XAUUSD) fell sharply by 2.83%, dropping below $4,100 intraday to a low of $4,020.95. Inflationary pressures from rising oil prices, alongside expectations that interest rates may remain higher for longer, continued to weigh on gold prices as the market also focused on next week's Federal Reserve rate decision meeting.

In cryptocurrencies, Bitcoin (BTC) erased the gains from the previous day's rebound, briefly falling below $81,000 intraday before recovering to around $81,300, representing a 24-hour drop of about 3.5% at the time of reporting. During the tech stock sell-off, crypto assets also faced pressure from cooling risk appetite.

Market News

Meta's third-quarter revenue grew 26%, with the lower end of its full-year capex guidance raised further. Meta reported third-quarter revenue of $64.601 billion, up 26% year-over-year; capital expenditures for the quarter were $34.91 billion, while free cash flow stood at negative $2.12 billion. The company narrowed its 2026 capital expenditure guidance from $130 billion–$145 billion to $135 billion–$145 billion, continuing to expand AI infrastructure investments.

Meta approves creation of non-voting Class C shares, planning a one-for-one stock dividend. The company plans to make the relevant charter amendment effective on January 19, 2027, followed by distributing one share of Class C common stock for each share of Class A and Class B common stock. The arrangement is expected to have a market price effect similar to a 2-for-1 stock split, with the specific distribution date not yet determined.

Tesla lowers full-year capex forecast as third-quarter free cash flow turns positive. Tesla's third-quarter revenue reached approximately $28 billion, while net profit dropped 44% year-over-year to $787 million, with adjusted earnings per share at $0.48. The company generated about $1.5 billion in free cash flow during the quarter and lowered its 2026 capex forecast to around $20 billion on its earnings call.

Lam Research quarterly revenue reaches $8.22 billion, up 22% quarter-over-quarter. The company reported revenue of $8.22 billion for the quarter ended September 27, with GAAP diluted earnings per share of $2.19 and adjusted earnings per share of $2.20. During the period, the company's gross margin reached 52.3%, and its operating margin stood at 40.0%.

US initial jobless claims fell to 194,000 last week, prior reading revised up to 200,000. The US Department of Labor reported that seasonally adjusted initial jobless claims for the week ended October 17 stood at 194,000, down 6,000 from the revised prior week. The previous week's figure was revised up from 199,000 to 200,000, and the four-week moving average fell to 197,750.

Procter & Gamble quarterly net sales rise 4%, maintaining full-year organic sales and earnings growth guidance. Procter & Gamble reported first-quarter fiscal 2027 net sales of approximately $23.3 billion, with organic sales up 4% year-over-year and core earnings per share at $2, up 1% year-over-year. The company maintained its full-year guidance for organic sales, earnings per share growth, and cash returns, while updating its net sales forecast due to the acquisition of Thorne.

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