Tech Earnings Stir Wall Street Amid AI Spending Surge

Wall Street is experiencing mixed reactions amid technology sector earnings reports. Notably, Meta and Tesla see gains on increased capital expenditures, while Microsoft falters due to unimpressive cloud revenues. Investors are scrutinizing AI investments for long-term monetization potential, as the Federal Reserve maintains interest rates unchanged, focusing attention on tech trends.

Wall Street braces for another volatile session as investors digest earnings results from leading tech corporations, revealing a significant uptick in AI spending. Meta experienced a substantial 8.9% rise in premarket trading, thanks to an optimistic revenue forecast alongside a notable increase in capital expenditure.

Conversely, Microsoft suffered a 6.8% drop as its cloud revenue underwhelmed, raising concerns about the monetization pace of its OpenAI collaboration. Despite mixed results among the influential 'Magnificent Seven' firms, investors maintain a forward-looking approach, prioritizing potential long-term returns on the hefty AI investments.

Elsewhere in the market, notable movements included Caterpillar and Mastercard reporting better-than-expected profits, while defense giant Lockheed Martin projected higher future earnings. With the Federal Reserve keeping rates steady, market focus remains on technology spending trends, as traders anticipate June for possible rate cuts.

(With inputs from agencies.)