5 things to know before the stock market opens Thursday

This is CNBC’s Morning Squawk newsletter. Subscribe here to receive future editions in your inbox.

Here are five key things investors need to know to start the trading day:

Magnificent Seven members Alphabet, Microsoft and Meta Platforms all beat Wall Street’s expectations yesterday, exceeding estimates for earnings per share and revenue while talking up expansion plans. But investors’ responses varied widely.

Here’s what to know:

• Alphabet shares surged more than 7% after the Google parent beat the Street’s forecasts for revenue tied to its Google Cloud and YouTube businesses. Executives said they plan to significantly ramp up spending next year to build infrastructure that can meet demand around AI.
• Meanwhile, shares of Microsoft slid more than 2% after the company forecasted increased spending growth this year and a said it took a $3.1 billion hit from its OpenAI investment. Microsoft went into yesterday’s report on its back foot as it addressed an outage affecting its Azure and 365 services.
• Meta shares tumbled 9% as traders focused on a one-time tax charge and a $4.4 billion loss from its Reality Labs business. CEO Mark Zuckerberg defended the Facebook parent’s big AI spending to analysts, saying the company is “seeing the returns.”
• Next up for Big Tech earnings: Apple and Amazon. The other two Magnificent Seven members report after the bell.
• Microsoft and Meta’s declines are weighing on stock futures this morning. Follow live markets updates here.

Investors seemed to get what they wanted when the Federal Reserve announced it was lowering interest rates by 25 basis points yesterday. But Fed Chair Jerome Powell threw cold water on market bulls with just five words.

Powell said that it “is not a foregone conclusion” that the central bank will lower rates again at its December meeting. Stocks took a leg down following the comment, dragging the Dow into the red after it notched all-time highs earlier in yesterday’s session.

The central bank chief also said the AI spending boom is “different” from the dotcom bubble of the late 1990s. Powell pointed out that companies involved in today’s AI bonanza “actually have earnings.”

Here are the biggest takeaways from the Fed meeting.

President Donald Trump said he and Chinese leader Xi Jinping reached a trade agreement following their meeting in South Korea — a significant development after months of tension between the two countries.

Trump said he would immediately halve fentanyl-related tariffs on China to 10% from 20%. The reduction moves the overall tariff rate on the Asian country down to 47% from 57%. In return, Beijing will restart soybean purchases and make an effort to quell the flow of fentanyl to the U.S.

China will also delay closely monitored export controls on rare earth materials for one year, Trump said.

Tech stocks aren’t the only thing driving the market this morning. Chipotle shares tumbled more than 18% after the fast casual chain missed third-quarter revenue expectations and cut its sales outlook, citing troubles with its younger consumer base.

Starbucks, meanwhile, shed around 3% after the coffee chain posted cooler-than-anticipated earnings per share in its fourth quarter. But the chain recorded same-store sales growth for the first time in almost two years and said its coffee delivery business exceeded $1 billion in sales during the fiscal 2025 year.

On the brighter side: Restaurant Brands International beat Wall Street forecasts on both lines for the third quarter, boosted by strength in its Tim Hortons brand and international business. Shares popped 3% in premarket trading this morning.

Comcast beat analysts’ estimates for the third quarter this morning despite failing to grow its broadband subscriber base for the fourth straight quarter. Investors will closely monitor executives’ call with analysts this morning for any comments on a potential acquisition of competitor Warner Bros. Discovery or some of its assets.

Wall Street has cast doubt over the likelihood that Trump would greenlight a Comcast-WBD deal. But people familiar with the matter told CNBC’s Alex Sherman that some Comcast executives think these concerns are blown out of proportion or too early to adequately assess. A Comcast spokesperson declined to comment.

Disclosure: Comcast is the parent company of NBCUniversal, which owns CNBC. Versant would become the new parent company of CNBC upon Comcast’s planned spinoff of Versant.