The U.S. equity markets exhibited a mixed trend in trading activity as investors absorbed the Federal Reserve’s recent decision to maintain the federal funds target rate between 3.5% and 3.75%. The S&P 500 index closed slightly lower by 0.01% at 6,978.03, the Nasdaq Composite inched up 0.17% to 23,857.44, while the Dow Jones Industrial Average was essentially flat with a marginal 0.02% increase at 49,015.60.
The Federal Open Market Committee’s statement indicated that economic expansion remains solid, although inflation levels are still somewhat elevated. Market caution persists as participants await further clarity from Federal Reserve Chair Jerome Powell during his upcoming press conference, especially amid ongoing political pressures and legal scrutiny related to subpoenas involving Powell’s testimony.
Meta Platforms Inc. (NASDAQ:META)
Shares of Meta Platforms experienced a dip during regular trading hours, closing down 0.63% to $668.73 following an intraday range between $666.10 and $677.68. The stock’s 52-week trading range lies between $479.80 and $796.25. However, after-hours trading saw a notable gain of about 6.6%, lifting the stock to $713.06.
Meta announced fourth-quarter revenue of $59.89 billion, surpassing analyst estimates of $58.30 billion, alongside an adjusted earnings per share (EPS) of $8.88, outperforming expectations of $8.16. The company reported a 24% year-over-year revenue increase, attributing growth to a 7% rise in daily active users, now totaling 3.58 billion. Advertising impressions grew by 18%, complemented by a 6% rise in ad pricing.
Looking forward, Meta forecasted first-quarter revenues between $53.5 billion and $56.5 billion. The company also projected full-year 2026 operating expenses ranging from $162 billion to $169 billion, with capital expenditures anticipated to be between $115 billion and $135 billion. These investments underline a sustained commitment to expanding infrastructure and advancing artificial intelligence initiatives.
IBM Corp. (NYSE:IBM)
IBM’s stock saw a slight gain in the regular trading session, closing at $294.16, reflecting a modest increase of 0.13%. The stock’s price fluctuated between $291.26 to $295.95 during the day and spans a 52-week range from $214.50 to $324.90. In extended trading, IBM's shares advanced by approximately 7.7% to $316.85.
Fourth-quarter revenues reached $19.69 billion, beating market forecasts of $19.23 billion, while adjusted EPS landed at $4.52, also exceeding consensus expectations. IBM’s annual revenue growth was 12%, fueled largely by software revenue expanding 14% and infrastructure business surging 21%. The latter growth was driven particularly by robust demand for mainframe systems.
IBM projects full-year 2026 revenue to top $70.91 billion, exceeding previous estimates. The company also anticipates increasing free cash flow by nearly $1 billion, contributing to positive investor sentiment and confidence in the stock’s outlook.
ServiceNow Inc. (NYSE:NOW)
ServiceNow’s stock declined 1.64% closing at $129.62 after trading between $129.14 and $133.67, within a 52-week price band of $123.78 to $239.62. The stock extended its losses in after-hours trading, sliding 5.3% to $122.77.
The company reported fourth-quarter revenue of approximately $3.57 billion, surpassing analyst estimates. Adjusted EPS was 92 cents, also ahead of expectations. Subscription revenue showed strong growth at 21% year-over-year, while remaining performance obligations increased 26.5% to $28.2 billion.
For 2026, ServiceNow anticipates subscription revenue in the range of $15.53 billion to $15.57 billion, implying an annual growth rate near 21% based on its forecast.
Carvana Co. (NYSE:CVNA)
Carvana’s shares experienced a significant drop of 14.17%, finishing at $410.04. The intraday trading range was between $374.55 and $477.59, with a 52-week range extending from $148.25 to $486.89.
The steep decline followed the release of a short report by Gotham City Research, which alleged Carvana had overstated projected earnings for 2023 and 2024 by more than $1 billion. The report also suggested that the company was relying heavily on undisclosed related-party support from DriveTime. Additional claims pointed to potential future financial restatements and the possibility of an auditor resignation.
Carvana firmly denied these allegations, labeling the report as inaccurate and misleading, thereby adding tension to the stock’s trading activity.
Tesla Inc. (NASDAQ:TSLA)
Tesla’s stock dipped marginally by 0.10%, closing at $430.46, after fluctuating between an intraday low of $430.10 and a high of $438.26. Its 52-week trading range extends from $214.25 to $498.82. In after-hours trading, shares rebounded by 2.16% to $439.74.
In its fourth-quarter earnings release, Tesla reported earnings per share of 50 cents, which beat analyst estimates of 45 cents. Revenue of $24.9 billion also edged past expectations. However, vehicle deliveries for the quarter declined 16% versus the prior year, totaling 418,227 units.
The company outlined plans to ramp up production in North America for the Tesla Semi and CyberCab vehicles during the first half of 2026. Additionally, Tesla plans to unveil its Gen 3 Optimus robot in the first quarter of next year.
Benzinga Edge Stock Rankings characterize Tesla’s stock with a value metric in the 4th percentile and momentum in the 73rd percentile, indicating relatively low valuation but solid price appreciation trends.
Market Overview and Outlook
The current market atmosphere reflects a balance between positive corporate earnings results and macroeconomic and political uncertainties. Investors are digesting a mix of strong revenue beats and growth projections from major tech companies alongside caution regarding inflation trends and Federal Reserve communications.
Political scrutiny of the central bank, as exemplified by subpoenas related to Chairman Powell’s testimony, introduces additional complexity into market sentiment. Meanwhile, short-selling reports targeting companies like Carvana demonstrate ongoing challenges that can impact stock valuations despite operational fundamentals.
Key Takeaways
- The Federal Reserve’s decision to keep interest rates steady maintains a cautious market environment despite solid economic growth signals.
- Meta and IBM surpassed quarterly revenue and earnings expectations, bolstering investor optimism about their technological and infrastructure investments.
- ServiceNow shows strong subscription revenue growth yet experienced post-market selling pressure, indicating investor concern about valuation or guidance.
- Carvana faces reputational risk following a short-seller report that questions its financial reporting integrity.
- Tesla’s earnings beat contrasts with a year-over-year decline in vehicle deliveries, highlighting mixed operational signals.
Risks and Uncertainties
- Potential volatility arises from the Federal Reserve’s forthcoming policy commentary amid ongoing inflation and economic data.
- Legal and political pressures on the Federal Reserve leadership could influence monetary policy decisions and market confidence.
- Allegations of financial misstatements at Carvana, if substantiated, may result in restatements or audit complications.
- Declines in Tesla’s vehicle deliveries could weigh on future revenue and earnings trajectories if they persist.