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Meta Shares Slump 25% Over Disappointing Q4 Results, BoE Raises Rates… AGAIN & Amazon Shares Slip Prior to Q4 Earnings

Meta shares down over 25%, as Q4 Earnings disappoint

Meta shares fell by as much as 27% on Thursday, as traders reacted to a disappointing Q4 earnings call.

In its first quarter since changing its name from Facebook, Meta reported that its daily active users had declined for the first time.

đź’ˇ Facebook’s… errr. Meta’s woes
Facebook surpassed its July 2018 19% drop. Making this, the biggest one day drop ever. The company has placed blame on Apple’s iOS Privacy changes, as well as macroeconomic challenges weighing heavy on advertiser’s pockets.

JPMorgan analysts downgraded the stock from overweight to neutral on Thursday and lowered their price target from $385 to $284. The analysts said Meta “is seeing a significant slowdown in advertising growth while embarking on an expensive, uncertain, multiyear transition to the Metaverse.”

The company reported that earnings came in at $3.67 per share, versus $3.84 expected for the quarter.

These earnings came on revenue of $33.67 billion versus $33.4 billion expected, with DAU’s falling to 1.93 billion vs 1.95 billion expected.

As of writing, $FB was down 27%, with the NASDAQ trading 1.57% lower.

GBPUSD hits 2-week high, as BOE raises rates, AGAIN

Sterling was higher, whilst London’s FTSE 100 was lower on Thursday, as markets responded to the BOE’s decision to once again cut rates.

The Bank of England decided to raise rates today, which is the first time since 2004 the bank has hiked rates in back-to-back meetings.

This came as Britain’s inflation rate rose to a 30-year high last month, which compelled the MPC to take further policy action.

đź’ˇ Haas inflation been solved
Well, no. Energy prices continue to rise and as Oil prices loom over multiple-year highs, transportation costs still have an undirect effect on consumer goods. So we can expect some more volatility as rates continue to rise. Investment experts say that owning shares in companies that can handle price shocks will ultimately prevail.

Following its decision, the MPC commented that, “The MPC judges that, if the economy develops broadly in line with the February Report central projections, some further modest tightening in monetary policy is likely to be appropriate in the coming months”.

GBPUSD hit a 2-week high of 1.3627 on the news.

Amazon stock slips, prior to earnings call

Shares in Amazon were lower on Thursday, as the tech-giant was preparing to release its Q4 earnings.

The decline in $AMZN comes as tech companies traded lower across the board, following the selloff of Meta.

Amazon is expected to report its Q4 figures after today’s closing bell, with the expectation that the company will show growth across the board.

Markets have forecasted that revenue will come in at $137.87 billion for the quarter, on earnings of $8.03 per share.

As of writing, $AMZN was trading 7.61% lower, with the S&P 500 also declining over 2%.

In post market action, Amazon soared over 15% as they released earnings

 “Only the game, can teach you the game.”

–Jesse Livermore.

Eliman Dambell

Senior Market Analyst