Inflation and growth concerns cause the Dow to drop over 600 points, potentially marking its largest decline of the year: Live updates.

The latest U.S. economic data revealed a slowdown in growth and indicated inflation, causing stocks to fall sharply on Thursday.

The stock market slid 689 points, or 1.8%, due to sharp declines in and . The stock dropped 1.2%, and the stock lost 1.4%.

The Bureau of Economic Analysis reported that U.S. gross domestic product grew 1.6% in the first quarter, while economists surveyed by Dow Jones predicted GDP growth of 2.4% for the same period.

Despite the slow growth rate for the quarter, consumer prices rose at a 3.4% pace, exceeding the previous quarter's 1.8% increase. This has sparked concerns about persistent inflation and whether the Federal Reserve will be able to lower interest rates in the near future.

According to Chris Larkin, managing director of trading and investing at E*Trade from Morgan Stanley, the market's deepest pullback since last year is unlikely to ease pressures in the short term, as the numbers do not provide a clear signal for either bulls or bears.

The CME FedWatch Tool indicates that traders now anticipate only one interest rate cut this year, following the GDP print.

Tech tumble

The sluggish GDP intensified the stress in the market, which was already grappling with worries about a decline in technology earnings growth.

The social media giant's premarket trading plummeted 13%, marking its largest one-day decline since October 2022. Additionally, the stock fell 8% after failing to meet consensus estimates for first-quarter revenue.

Despite the focus on generative AI in the past nine months, Meta's failure to meet its revenue growth projections in Q1 is prompting doubts about the ease of monetizing this technology, as traders were led to believe by management, according to Thierry Wizman, global FX and rates strategist at Macquarie.

Meta's report raises concern ahead of other big tech releases, including Facebook, which is also slated to post earnings after the close Thursday.

10:46 a.m.: IBM and Caterpillar lead Dow lower

On Thursday, the Dow plummeted nearly 700 points, heading towards its worst day of the year.

The 30-stock index was led into the red, dropping more than 9% and 7%, respectively, on the back of earnings. Both companies missed analyst estimates for revenue in the quarter.

Microsoft and Amazon were the next poorest performers, losing approximately 3.97% and 3.95% respectively.

In the session, more than two out of every three Dow stocks traded down, except for Merck and UnitedHealth, which reported better-than-anticipated earnings and were up more than 1% each.

10:22 a.m.: Meta shares on pace for worst day since October 2022

On Thursday, the stock's shares plummeted 11.34%, putting it on track for its worst day since October 27, 2022, when Meta declined 24.56%.

Despite Meta's better-than-expected earnings in the first quarter, shares fell after the company issued weak revenue guidance and CEO Mark Zuckerberg's comments on long-term investments in artificial intelligence and the metaverse intensified the sell-off.

— Hakyung Kim

10:04 a.m.: New York Stock Exchange decliners lead advancers 10-1

On Thursday, 210 NYSE-listed stocks advanced, while 10 fell for every one that rose, as the latest GDP report and new tech earnings dampened investor sentiment.

— Fred Imbert

The U.S. GDP report was a disappointment for investors.

If inflation remains stubborn, a dismal U.S. GDP report could signal trouble for the equity market, according to one investor.

Chris Zaccarelli, investment chief at Independent Advisor Alliance, wrote that this report was the worst of both worlds, as economic growth is slowing and inflationary pressures are persisting.

If the market does not see economic growth and corporate profits increasing, and the Fed does not see inflation coming down in a persistent manner, then that will be bad news for markets.

The upcoming PCE report, which is the Fed's preferred measure of inflation, will have higher stakes for personal consumption expenditures, as investors hope it will show a decrease in pricing pressures after the March consumer inflation report exceeded expectations.

— Sarah Min

9:33 a.m.: Stocks fall after GDP data shows slowing economic growth

On Thursday, stocks began the day lower as equities sold off following new GDP data that indicated a slowing economy.

The stock market experienced a decline, with the Dow Jones Industrial Average, S&P 500, and Nasdaq Composite all losing ground.

— Brian Evans

8:58 a.m.: 10-year Treasury yield jumps to highest level since November

Since the release of the GDP report, the stock market surpassed 4.7% and reached its highest point since November.

The Federal Reserve may hold rates steady until inflation recedes due to rising prices, which could slow economic growth and push the central bank toward rate cuts.

— Jesse Pound

8:51 a.m.: Gross domestic product slowed in the first quarter

The Bureau of Economic Analysis reported that U.S. gross domestic product growth slowed in the first quarter, causing stock futures to decline before the market opened.

While economists predicted growth of 2.4% in the first quarter, GDP only expanded by 1.6%.

— Brian Evans