US markets opened the third quarter with a twist nobody had on the card. Meta, the company that has spent more than anyone buying AI computing power, announced it will start selling it, launching a cloud business to rent out its spare capacity. Meta jumped nearly 9 percent. The companies that sell computing power fell hard.
Where Wednesday landed:
• Dow 52,305.24 (-0.03%) — touched a fresh intraday record before fading
• S&P 500 7,483.23 (-0.22%) — yet most stocks in the index rose
• Nasdaq 26,040.03 (-0.66%) — chip profit-taking did the damage
• Russell 2000 3,012.59 (-0.39%) — held above the 3,000 mark
The flip, explained: For weeks this brief has tracked the AI trade’s two sides — the companies buying computing power (Meta, Microsoft, Amazon) and the companies selling it (Micron, Sandisk, CoreWeave). On Wednesday the biggest buyer switched sides. Meta will rent out its excess AI capacity, which means a new revenue line for Meta and a new competitor for everyone else. CoreWeave fell 14 percent, and Micron and Sandisk dropped about 11 percent each — though after gains of roughly 260 and 750 percent this year, part of that is simply profit-taking. Microsoft rose 3 percent and Apple about 2 percent, so this was a reshuffle inside the AI trade, not an exit from it.
The Fed’s new voice: Fed Chair Kevin Warsh made his global debut in Portugal and said inflation expectations have eased over the past month, suggesting no urgency to raise rates — though markets still price a better-than-even chance of a September hike. Private hiring slowed to 98,000 jobs in June, below forecasts.
Oil keeps helping: Crude fell below 69 dollars, its lowest since February, as US-Iran talks in Doha made progress. Cheaper oil is quietly doing part of the Fed’s work.
Tonight’s test: The June jobs report lands this evening IST — a day early, because US markets are closed Friday for July 4. A soft number weakens the case for a rate hike; a hot one strengthens it.
For us in India: Falling crude is a direct tailwind — India’s oil imports hit a June record of about 5 million barrels a day, so every dollar off Brent eases our import bill, inflation and rupee pressure. And Meta’s cloud entry matters for Indian IT and data-centre plays, because cloud capacity battles are increasingly fought on Indian soil too.