Traders work on the trading floor of the New York Stock Exchange (NYSE) on July 22, 2024 in New York City.
Timothy A. Clary | AFP | Getty Images
Stocks fell on Wednesday after dismal reports from two big tech companies dampened investor sentiment Nasdaq Index It promises to be the worst day in October.
The tech-heavy Nasdaq fell 2.5%, while S&P 500 Index down 1.6%. this Dow Jones Industrial Average It fell 377 points, or 0.9%.
Shares of Google’s parent company letter down 4%. Although Alphabet’s revenue and profits exceeded expectations, YouTube ad revenue drops Below consensus estimates. at the same time, Tesla Share price fell 12% due to lower-than-expected results 7% annual reduction In terms of car revenue.
Other big tech stocks also fell along with Alphabet and Tesla. Nvidia and meta platform fell 4% each, while Microsoft down 3%.
The reports mark investors’ first look at how large companies performed in the second quarter. Wall Street is particularly interested in reports from these names because this small group has generated much of this year’s gains.
“One of the quickest ways for a rotation to occur beneath the surface is for the Big Seven to miss earnings targets,” Strategas strategist Ryan Grabinski wrote. “We’ve been discussing for some time how ‘AI enthusiasm’ will eventually turn into ‘AI Disappointment. The next two weeks will be critical.
So far, though, the earnings season is off to a generally good start. more than 25% S&P 500 Index FactSet data shows that companies have reported second-quarter earnings, about 80% of which exceeded expectations.
Adding to investor concerns Wednesday morning U.S. manufacturing data weaker than expected.
The preliminary value of the US July PMI manufacturing output index fell to 49.5, unexpectedly slipping into contraction territory due to declines in new orders, production and inventories. Economists had forecast a value of 51.5, according to Dow Jones data.
A report Wednesday also showed new home sales rose lighter than economists expected June.
