The Dow has its biggest loss since October

Facebook's business continues to fire on all cylinders, even as the company faces growing scrutiny from regulators over its acquisitions and from critics for the role its platform may have played in spreading lies about the US presidential election.

The company said Wednesday that it posted a profit of $11.2 billion in the final three months of last year, an increase of more than 50% from the year prior. Facebook's revenue rose 33% to roughly $28 billion during the quarter, showing the durability of its core advertising business despite the pandemic.

When combining Facebook's various apps, including Instagram, Messenger and WhatsApp, the company reported 3.3 billion monthly active users, an increase of 14% year-over-year.

Facebook CEO Mark Zuckerberg said in a statement:

While Facebook ended the year on a strong note, it once again warned of challenges for the year ahead, including "the "evolving regulatory landscape" as well as looming iPhone software changes that it expects will hurt its advertising business.

Read more about Facebook's earnings.

Tesla capped its breakout year with a record profit that still fell short of analysts forecasts, sending its shares 6% lower in after-hours trading.

The electric car maker reported fourth quarter adjusted income of $903 million, excluding special items, more than double its earnings a year ago but still short of the $1.1 billion forecast by analysts. Net income was $270 million, well short of the $780 million estimated by Wall Street.

Still, the results capped a year of strong growth for the company despite the problems associated with Covid-19 pandemic:

Read more about Tesla's earnings.

Analysts have talked for at least a year about the potential for Apple's first 5G iPhone to drive a "supercycle" of device sales. On Wednesday, Apple's earnings report for the three months ended December 26 — the first since the iPhone 12 went on sale — offered an initial look at how actual sales are stacking up against that projection.

Strong iPhone sales pushed the company's total quarterly revenue to a record $111.4 billion — well above the $103.3 billion Wall Street analysts had predicted. Apple (AAPL) posted earnings of $16.8 per diluted share, up 35% from the same period in the prior year.

iPhone sales were also even better than expected: Growing more than 17% year-over-year to nearly $65.6 billion, compared with the $59.8 billion analysts had expected. Apple executives last quarter had said they expected single-digit percentage growth in iPhone sales during the December quarter.

Morgan Stanley analysts wrote in a note to investors ahead of the report:

Read more about Apple's earnings.

At least one big bank is instructing its financial advisers to steer clear of making recommendations on GameStop and AMC amid the insane swings in those stocks, CNN Business has learned.

Wells Fargo banned its advisers from contacting clients to tell them to buy or sell GameStop (GME) and AMC (AMC).

"As of today, Wells Fargo Advisors is not allowing solicitation of those two securities," a spokesperson said in a statement.

The decision was driven by the extreme volatility in GameStop and AMC, whose shares have skyrocketed after getting heavily promoted by Reddit's Wall Street Bets community.

Wells Fargo's clients can still call their advisers to initiate trades in those stocks, though. The decision only means that Wells Fargo's 13,000 advisers cannot make recommendations about those two stocks.

It's not clear how many other big banks are taking similar steps.

Representatives for Bank of America, Citigroup, JPMorgan and UBS did not immediately respond to requests for comment.

US stocks fell sharply after the Federal Reserve said the economic recovery and job market have “moderated” due to the pandemic.

The Dow suffered its biggest loss since October, dragged down by weak results from Boeing (BA). Both the Dow and S&P 500 are now down year-to-date.

But GameStop (GME) and AMC (AMC), two stocks currently hot with the Reddit/Robinhood crowd, continued to surge as bulls are squeezing short sellers.

 As stocks settle after the trading day, levels might still change slightly.

Senator Elizabeth Warren is neither shocked nor saddened by the Wall Street firms getting run over by Reddit-fueled trades in GameStop and AMC.

"For years, the same hedge funds, private equity firms, and wealthy investors dismayed by the GameStop trades have treated the stock market like their own personal casino while everyone else pays the price," the Massachusetts Democrat said in a statement Thursday.

A group of Reddit users have targeted GameStop (GME), AMC (AMC) and other stocks that are heavily bet against by short sellers. They have successfully sent the stocks skyrocketing -- despite a lack of major fundamental news. And that has caused massive losses for some hedge funds and other market players.

"It's not news that the stock market doesn't reflect our actual economy," Warren said.

The Democrat, who is the ranking member on the Senate subcommittee on financial institutions and consumer protection, used the incident to renew her call for a crackdown on Wall Street.

"It's long past time for the SEC and other financial regulators to wake up and do their jobs," Warren said, "and with a new administration and Democrats running Congress, I intend to make sure they do."

We all want this pandemic to end. But the normally reserved Federal Reserve Chairman Jerome Powell got all fired up at the end of his otherwise dry press conference Wednesday.

His message: Solve the damn vaccination problem.

"There's been a lot of adapting -- but you can't adapt hotels, sporting venues, movie theaters, restaurants, bars. That's millions and millions of people," Powell said. (He added that he has had the first shot, but not the second, btw).

"And so you're just going to have to defeat the pandemic, which as I mentioned, we have a plan to do that but we haven't done it yet. We need to finish the job. It's within our power to do that as a country this year. I would just urge that -- I know people are working hard on that -- but that is really the main thing about the economy is getting the pandemic under control, getting everyone vaccinated, getting people wearing masks and all that.

"That's the single most important economic growth policy that we can have."

'Nuff said.

Federal Reserve Chair Jerome Powell said the future is uncertain as the economic recovery is growing weaker.

That's not exactly music to investors' ears.

"The economic dislocation has abandoned many lives and created great uncertainty about the future," Powell said. "Something like 9 million people remain unemployed as a consequence of the pandemic. That's as many people lost their jobs at the peak of the global financial crisis in the great recession. Many small businesses are under pressure and other needs to be addressed and the path ahead is still uncertain."

All that talk of uncertainty sent stocks — which were already down a bunch — even lower.

With 30 minutes left to trade, the Dow was down 640 points, or 2%. The S&P 500 fell 2.7% and the Nasdaq was 2.9% lower.

Technically, if the Fed wanted to weigh in on the GameStop saga, it could. But Fed Chair Jerome Powell said the Fed's not considering that right now.

Under a provision called Regulation T, the Fed can set the rules brokerage firms like Robinhood and TD Ameritrade have for their customers. For example, the Fed could mandate that investors pay for stocks with cash rather than borrowed money -- a step Robinhood took for GameStop and AMC today.

But Powell ruled that out.

"Remember, we're focused on maximum employment, price stability, financial stability of, as I defined it, the broad financial sector," said Powell. "Over the years we consult the fact we have that authority, but it's not something we're looking at right now at all."