On Thursday (May 30th), following a climb in U.S. bond yields to the highest level in a month on Wednesday, slightly soft economic data released on Thursday provided some relief to investors concerned that the resilience of the U.S. economy would reduce the Fed’s room to cut interest rates.
The U.S. Department of Commerce released a report on Thursday, lowering the economic growth rate for the first quarter of the United States below expectations after adjustments to consumer spending. The Gross Domestic Product (GDP) growth rate for the year was revised down from the previous 1.6% to 1.3%. In a separate report, the weekly number of jobless claims also increased slightly.
The U.S. 10-year Treasury bond yield hit its highest level since the end of April on Wednesday and then fell back to below 4.6%. The Dow Jones Industrial Average traded lower in early trading, continuing its recent decline. After dropping more than 400 points on Wednesday, by 12:22 PM Eastern Time on Thursday, it had dropped over 300 points.
U.S.-based business software provider Salesforce issued gloomy forecasts, causing its stock to plummet by 54 points, a 20% decrease, to around $217.16, dragging down the blue-chip indexes, with the Nasdaq index falling more than 80 points.
Apart from large tech stocks, other stocks performed better. Of the 11 sectors in the S&P 500 index, 9 remained flat or saw gains, with the Russell 2000 index rising by over 1%.
Salesforce’s quarterly revenue fell short of expectations, mainly dragged down by professional consulting services, and the company lowered its fiscal year expectations for subscriptions and business revenue.
Salesforce’s performance for the first quarter of fiscal year 2025: Revenue of $9.13 billion, slightly below the market’s expected $9.15 billion; “Subscription and Support Services” business revenue increased by 12% year-on-year to $8.59 billion; while “Professional Consulting Services and Others” business revenue decreased by 9.4% year-on-year to $550 million.
Although the revenue growth rates for Salesforce’s core products have all improved, professional consulting services fell short of market expectations at $570 million due to a decrease in project volume.
Overseas stock markets showed mixed movements. European stock markets saw a slight increase, while Asian benchmark indices countered the sell-off in the U.S. stock market from Wednesday. Japan’s Nikkei 225 index dropped by over 500 points, a 1.3% decline, while Hong Kong’s Hang Seng index fell by 246 points, also a 1.3% decrease.