Stocks fell on Wednesday after a disappointing first round of tech earnings made investors more cautious in looking toward the second half of the week.
The tech-heavy Nasdaq and S&P 500 are down 1.8% and 0.7%, respectively. The Dow Jones Industrial Average was hovering around a flat line, as Visa shares gave the index a small boost on strong quarterly numbers.
Shares of Google subsidiary Alphabet fell 8.5% after the tech giant Missed expectations on the final result. Alphabet also reported a drop in YouTube ad revenue, which prompted investors to discuss the prospects for other tech companies that rely on ad spend.
Meanwhile, Microsoft stock fell about 7.6% after that The tech giant reports weaker-than-expected cloud revenue In its latest quarterly results, though, it beat earnings and revenue estimates. The company also issued guidance on current quarter revenue that did not live up to expectations.
“I think we have to take a big picture and realize that nobody is really immune in this market, there’s a slowdown in spending,” Sand Hill Global Advisors Brenda Vengelo said Tuesday on CNBC’s “Closing Bell: Overtime.” on digital advertising.
In other earnings news, shares of Harley-Davidson rose 6.7% after the motorcycle maker reported beating expectations before the bell. Meta was among the companies scheduled to report.
“Investors may have been a little surprised by Microsoft’s negative guidance,” said Sam Stovall, chief investment analyst at CFRA, while noting that other companies such as Coca-Cola and UPS are doing better. “I think investors are feeling a little better in terms of the big blues.”
Wednesday’s early performance is a turnaround from the past three days of rallying for major indices. On Tuesday, the Nasdaq closed up 2.2%, while the S&P 500 and Dow added 1.6% and 1.1%, respectively. Tuesday’s close marked the first time in October that major indexes rebounded three days in a row.
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