The Daily Breakdown: Negative GDP?!

The Each day Breakdown appears to be like on the newest GDP print, which confirmed an financial contraction for the primary time since early 2022.

Thursday’s TLDR

META & MSFT ship
GDP turns destructive
BTC hits multi-month excessive

What’s Taking place?

Earlier than we dive in, let’s be sure to’re set to obtain The Each day Breakdown every morning. To maintain getting our each day insights, all you must do is log in to your eToro account.

Yesterday’s large speaking level was the destructive Q1 GDP print. Nonetheless, that dialogue appears to be taking a again seat to the massive earnings responses from Meta and Microsoft. 

Whew!

Bulls wanted mega-cap tech to report robust outcomes. Tech has a 30% weighting within the S&P 500 and has been the second-worst performing sector up to now this yr — about doubling the decline that SPY ETF has seen. Not solely are these a few of buyers’ favourite shares, however they’ve enormous weightings too. 

That is nice to see, however it doesn’t ease a number of the worries round that destructive GDP print, so let’s break that down. 

Imports surged within the newest quarter, (which subtracts from US GDP). Imports jumped as companies positioned themselves forward of tariffs, making an attempt to keep away from pointless worth will increase. Additional, after 10 straight quarters of constructive contribution to GDP, authorities spending dipped. Given the Administration’s strategy to the federal authorities by way of DOGE, this contraction isn’t too shocking. 

However outdoors of the noisy import/export information, enterprise and client spending was first rate. We’ve heard on company convention calls that client spending has been a little bit lumpy, however regular all through 2025. 

That is the massive one to know: Private consumption is greater than two-thirds of the GDP report. It confirmed annualized progress in Q1, however posted its lowest determine in virtually two years. Shoppers proceed to spend, which is sweet, however falling confidence appears to be holding them again. 

Need to obtain these insights straight to your inbox?

Join right here

The Setup — Meta

Final evening, Meta beat on earnings and income expectations and spoke optimistically sufficient on its convention name to get buyers excited. In response, shares are greater by about 5% to six% in pre-market buying and selling. 

Yesterday we checked out some key ranges for Microsoft. With it above its 200-day in pre-market buying and selling, it’d be nice to see it clear this measure and keep above it in at present’s common session. 

Can Meta do the identical factor? 

After I take a look at Meta, I see a inventory that discovered assist close to $480, then cleared downtrend resistance (the blue line) forward of earnings. 

You would possibly discover the value vary I added to the appropriate aspect of the chart, exhibiting what a 6% rally appears to be like like from yesterday’s shut. That places it proper close to $580, $100 a share off the latest lows, and proper into the 50-day and 200-day shifting averages. 

Be at liberty so as to add a few of these measures to your personal Meta charts, too. 

From right here, bulls will need to see META inventory cost via these measures and begin to use them as assist. Bears will hope that these measures are resistance. If Meta does break via them although, a bigger rebound might ensue. 

Choices

For some buyers, choices may very well be one different to take a position on Meta. Keep in mind, the danger for choices patrons is tied to the premium paid for the choice — and dropping the premium is the complete danger. 

Bulls can make the most of calls or name spreads to take a position on additional upside, whereas bears can use places or put spreads to take a position on the positive aspects petering out and Meta rolling over. 

For these seeking to be taught extra about choices, take into account visiting the eToro Academy.

What Wall Avenue is Watching

MSFT – Microsoft shares are greater by about 9% in pre-market buying and selling. The corporate cruised previous analysts’ earnings and income expectations, and delivered robust cloud outcomes with its Azure unit. What’s extra, administration spoke favorably about enhancing working margins for the yr.  

BTC – Bitcoin has been holding up properly over the previous few weeks and continues to inch greater. It’s now at its highest stage since February twenty fourth, formally hitting a multi-month excessive. It’s acquired some questioning if $100K is subsequent and whether or not it may well elevate different cryptocurrencies, like ETH. Take a look at the chart for BTC. 

Disclaimer:

Please observe that as a consequence of market volatility, a number of the costs could have already been reached and eventualities performed out.