Microsoft Soars 16% as Azure Tops $100B
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- Microsoft stock surged 16.57%, on track for its best day since 2008, after its Azure cloud business topped $100 billion in revenue for the first time
- Meta shares fell about 9%, extending a historic losing streak, after its Q2 earnings miss deepened investor concerns about recouping massive AI investments
- The Nasdaq Composite jumped 2.82%, the S&P 500 rose 1.71%, and the Dow Jones gained 1.25% in a tech-led rebound after the Nasdaq-100 entered correction territory Wednesday on chip stock declines
- The 30-year Treasury yield climbed to a multidecade high near 5.24% as the bond market revolted following the Federal Reserve's Wednesday decision to hold rates steady
- Overnight US strikes on a dozen Iranian targets threatened further escalation that could rekindle inflation, even as oil prices stayed flat Thursday morning
- PCE inflation data showed prices advancing at a slower pace in June than May, while Q2 GDP grew slower than expected per the Commerce Department
- Amazon reports earnings after Thursday's bell with AWS growth under scrutiny, followed by Apple, where margins face pressure from memory chip price hikes
Why it matters: Microsoft's 16.57% rally marks its best day since 2008 and validates the AI-cloud capex thesis at the $100B Azure milestone, while Meta's 9% slide highlights the widening AI-spending divide within the Magnificent Seven. Amazon's after-bell report becomes the next gatekeeper for whether hyperscaler capex continues to translate into cloud revenue or just balloon costs.
