Meta's new non-voting share class turns an AI rally into a funding scare

Meta's plan to raise hundreds of billions through Class C shares sent the Nasdaq 100 down 2.9% on Thursday, while Treasuries had their best day in over a year and Brent hit $116.93, its highest since May

Deepakshi

Kristal Research & Marketing team

23 Oct2 min

Key takeaways — AI summary

The S&P 500 slipped 0.47% to 7,623.68 for a second straight weekly loss and the Nasdaq 100 fell 0.79%, but the week masked a sharp turn: a Monday-to-Wednesday AI relief rally lifted the index to 7,759, then Meta's non-voting Class C share plan — leaving Mark Zuckerberg with about 61% of votes on roughly 13.4% of economic interest — triggered a Thursday funding scare, with the Nasdaq 100 down 2.9% and chip stocks off more than 6%, even as the equal-weight S&P rose 0.7% and the Russell 2000 ended the week up 2%.
Bonds rallied on the prospect of less AI borrowing: the 10-year Treasury yield fell 11 bps to 4.99%, closing below 5% for the first time in a month; odds of a Fed hike on October 28 dropped from about 41% to roughly zero, though a December hike stayed about 72% priced.
Commodities sent the opposite signal: Brent rose 6.6% to $116.93 (highest since May) and WTI ended at $103.44 after Houthi attacks on Saudi oil sites and reports the US and Israel plan to strike Iran after the midterms, while gold fell 4.08% to $3,995.63, below $4,000 for the first time since mid-July.
US data showed a firm labour market but cracking housing: jobless claims fell to 194,000 (lowest since July), while pending home sales dropped 7.3% to a record low and homebuilder confidence sank to 29, the weakest since June 2012, with 30-year mortgage rates near 7.4%.
The research desk published six earnings reviews framed around who keeps AI value — SpaceX revenue up 161% to $14.6bn, Meta up 26% to $64.6bn with capex of $34.9bn, Netflix, Lam Research, Spotify and Bloom Energy — while Gartner estimates data-centre owners need $8.5 trillion of cumulative revenue by 2030 against a $3.6 trillion forecast, a $4.9 trillion gap.

Generated by Kristal AI · reviewed by the research desk

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