Stocks falls on megacap drag, yen stumbles after BOJ announcement

NEW YORK: Global shares dropped on Thursday (Oct 30) and were set for their biggest daily decline in three weeks, weighed down by megacaps Microsoft and Meta, while the dollar rose against the yen on policy updates from the Federal Reserve and Bank of Japan. Markets were digesting comments from Fed Chair Jerome Powell, who dampened expectations that the US central bank will cut interest rates at its December meeting after easing by 25 basis points on Wednesday. Market reaction was muted after US President Donald Trump said he had struck a deal with President Xi Jinping to trim tariffs on China in exchange for Beijing cracking down on the illicit fentanyl trade, resuming US soybean purchases and keeping rare earths exports flowing, which markets had been anticipating in recent days. On Wall Street, US stocks closed lower, as Meta Platforms, one of the "Magnificent Seven" group of megacap stocks, plummeted 11.3 percent after it reported quarterly results and forecast larger capital costs after the close on Wednesday. Bloomberg reported on Thursday that the Facebook and Instagram parent was targeting at least US$25 billion in a bond sale. Also weighing on equities was a 2.9 percent decline in Microsoft following its quarterly earnings. Those declines overshadowed a 3.1 percent climb in Google parent Alphabet as its earnings beat expectations due in part to strong artificial intelligence demand. "We saw there's questions on how much spending on the companies that released yesterday, that's going to pull the index down. It's a big, sizable chunk of the index," said Gene Goldman, chief investment officer at Cetera Investment Management in El Segundo, California. Goldman said that as the market has rallied strongly since April he has been expecting a pullback, which he sees as a buying opportunity.