Nasdaq, S&P 500 suffer worst day of year as AI stocks tumble and Fed rate-hike odds rise

The Financial Times reports that Meta is considering raising “tens of billions” via a new stock offering to fund major AI spending, with discussions led by CFO Susan Li and President Dina Powell McCormick. The report cites plans to raise AI capex to as much as $145bn in 2024 and higher in 2027. Meta said talks are “pure speculation,” and the stock fell to a late-April low.

U.S. stocks fell Friday after a blowout May jobs report boosted expectations of a late-2024 Fed rate hike. The Dow fell 1%, the S&P 500 dropped 2.4%, and the Nasdaq slid 4%, with tech and Nvidia hit. Treasury yields rose; the 2-year hit a 15-month high at 4.164%. Oil eased after port operations resumed; Brent $93.09 and WTI $90.54.

The article discusses Broadcom’s Q2 outlook, stating that AI demand continues to support a strong ramp into FY2027. The author says Broadcom did not raise its FY2027 AI target and notes the stock is down nearly 20% since the Q2 release. They cite a $30B-plus AI order book and say investor focus is on bookings converting to shipments and on margins.

Florida Trust says investors have focused on the “Magnificent 7” and OpenAI since ChatGPT’s 2022 launch, but that crowded exposure (35% of the S&P 500) may mean lower returns and higher risk. The firm highlights AI-linked opportunities beyond big tech, including industrials (S&P Industrials up ~18% YTD) tied to datacenter turbines and utilities facing a projected 44 GW US power shortfall through 2028. It cites Constellation Energy and Dominion Energy, plus datacenter REITs (Equinix, Digital Real

SpaceX plans to price its IPO at $135 per share next week, targeting a total valuation of about $1.77 trillion, according to its updated IPO prospectus. The filing values Elon Musk’s SpaceX stake at $866.5 billion and says he will retain voting control above 82%. SpaceX reported $18.67 billion in revenue last year.

SpaceX is scheduled to begin trading next Friday after an initial public offering that the article says would raise $75 billion and value the company at $1.77 trillion, placing it among the largest U.S. public firms. The report also notes index weighting changes (3x multiplier) that could amplify post-IPO moves. It adds that upcoming CPI/PPI data may affect rate expectations.