It never made sense to me that Facebook, now the core of Meta Platforms (NSDQ: META), for years sported a larger market cap than many iconic industrial firms. Perhaps Wall Street is finally coming around to my view. Meta is no longer among the 20 most valuable U.S. companies, after the stock plunged nearly 25% on Thursday.

Meta on Wednesday posted a shocking 52% year-over-year drop in quarterly earnings. Indeed, as third-quarter S&P 500 earnings come pouring in this week, the mega-cap Silicon Valley darlings have performed worse than the “boring” companies that actually make stuff.

As the bear market shows signs of bottoming and you position your portfolio for the bull rebound, it’s time to look outside of tech for the market’s next leaders. This positioning especially makes sense, when you consider the surge in infrastructure spending that’s poised to occur around the world.

President Biden managed to get massive increases in infrastructure spending through Congress, but it’s not just the U.S. that’s rolling up its sleeves. China and emerging markets have drawn blueprints for ambitious construction projects. And when the Russia-Ukraine war finally winds down, the devastated country of Ukraine will require billions of dollars of reconstruction. Many of these contracts will go to U.S.-based firms.

If you think all old-line companies in America’s industrial heartland are basket cases, think again. That’s a false narrative. Many industrial firms based in the United States don’t need red caps emblazoned with slogans; they’re already great. However, they tend to get overshadowed in the financial media by the Silicon Valley “story stocks.”

Sure, the world has shifted to an information-based economy, creating winners and losers. But in recent years, a quiet revolution has unfolded in the U.S. economy; many domestic industrial companies are in the ascendancy. They’re streamlining operations, spawning innovation.

Energy and industrials in the vanguard…

According to research firm FactSet, the energy and industrials sectors are leading the way in year-over-year blended earnings growth for Q3 2022. Due to rising energy prices, energy is number one at 116.4%; industrials is second at 24.7%. Information technology comes in at a distant seven, at -4.6%.

After the closing bell Thursday, Apple (NSDQ: AAPL) and Amazon (NSDQ: AMZN) posted operating results. Both beat on earnings, but Apple missed revenue expectations for important segments such as iPhone sales, and Amazon’s revenue and guidance were badly off the mark.

Operating results released earlier this week by other mega-cap tech firms generally underwhelmed Wall Street, including those from Microsoft (NSDQ: MSFT), Texas Instruments (NSDQ: TXN), Alphabet (NSDQ: GOOGL), and Meta Platforms.

Read This Story: Wall Street Unfriends Zuckerberg

The worst miss was posted by Meta, shares of which have crashed and burned like the Hindenburg. Some of the momentum tech stocks that fueled the previous bull market are facing their day of reckoning.

Meta founder and CEO Mark Zuckerberg’s ill-advised gamble on a holistic virtual reality concept that he calls the “metaverse” has spooked Wall Street and undercut earnings (see chart).

However, it’s the supposedly non-glamorous companies that have shined so far this earnings season. Many of them produce durable goods, defined as tangible products that can be stored or inventoried and which have an average life of at least three years.

Aecom (NYSE: ACM); Caterpillar (NYSE: CAT); CSX (NSDQ: CSX); Lockheed Martin (NYSE: LMT); Southwest (NYSE: LUV); Honeywell (NYSE: HON); Johnson & Johnson (NYSE: JNJ); General Motors (NYSE: GM); Harley-Davidson (NYSE: HOG); McDonald’s (NYSE: MCD); ExxonMobil (NYSE: XOM); and Chevron (NYSE: CVN) have all surpassed projections on earnings, lifting their share prices.

Friday’s big bounce…

On Friday, the major U.S. stock market indices soared higher, closing as follows:

• DJIA: +2.59%
• S&P 500: +2.46%
• NASDAQ: +2.87%
• Russell 2000: +2.25%

The Dow Jones Industrial Average is on track for its best monthly performance since January 1976. For the week, the sector leader was industrials and the Dow leaders were Caterpillar and Honeywell.

Earnings beats from Apple, Intel (NSDQ: INTC), Verizon (NYSE: VZ), and Gilead Sciences (NSDQ: GILD) offset Amazon’s quarterly weakness and helped drive Friday’s rally. Biotech played a major role in the NASDAQ’s jump higher. However, the surge in equities was broad-based and largely due to U.S. economic data that dispelled recession fears.

The Commerce Department reported Thursday that U.S. gross domestic product (GDP) rose 0.6% in the third quarter, a 2.6% annual rate of growth. It was the first increase after two consecutive quarterly contractions.

The latest GDP data will figure prominently in the Federal Reserve’s deliberations next month, when it’s expected to hike interest rates by another 75 basis points. Stay tuned for the Fed’s meeting, November 1-2.

There’s another pivotal meeting on November 1 you should know about…

On that date, I’m holding a special investment Town Hall, called “The Marijuana Millionaire Countdown.”

As the U.S. midterm elections loom on the calendar, I’ll explain the little-known reason why federal legalization of marijuana could be days away…and why a slew of states are on the cusp of creating new state-legal markets.

New state-legal markets equal new growth for well-positioned marijuana companies. The time to invest in marijuana stocks is now, before political catalysts propel the,m higher.

During my online Town Hall, I’ll reveal the one simple marijuana trade that could dump piles of cash into your brokerage account, before the midterm votes are even counted. Click here to grab your free spot!

John Persinos is the editorial director of Investing Daily.

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