Microsoft and Meta highlighted contrasting market views on AI investment. Microsoft’s strong Azure growth and stable capital spending plans reinforced confidence that AI investments are generating returns. Meta, despite solid revenue growth, disappointed with weaker earnings, softer guidance, and sharply lower free cash flow as heavy capital expenditure weighed on profitability. Meanwhile, a hawkish Federal Reserve stance and rising bond yields intensified concerns over inflation and valuations, contributing to a broad-based equity market sell-off.