The tech-heavy Nasdaq tumbled more than 2% on Tuesday as nerves surrounding Big Tech’s earnings this week added to concerns over slowing global growth and a more bullish Federal Reserve.
Market-leading growth stocks have tumbled this year as investors fear the impact of higher interest rates on their future earnings, while China’s lockdowns and hawkish pivots by major central banks saw a better-than-expected earnings season so far Is.
Growth-oriented sectors such as technology, S&P 500 communications services and consumer discretionary declined nearly 2%, with losses in 11 key S&P 500 sectors.
Alphabet Inc. and Microsoft Corp. fell 2.7% and 2.2%, respectively, from their results after the closing bell on Tuesday. They are among a third of the S&P 500 companies slated to report results this week.
Julius de Kempener, senior technical analyst at StockCharts.com, said, “Given the market picture (right now), if any of these tech companies report earnings below expectations, it could be very dangerous because of the downside. delicate.”
“If they report better numbers than expected, I don’t think it will be enough to replace the current weakness in the market.”
Although there were some earnings bright spots, the overall mood in the market was depressed due to fears of global growth, China’s tightening of COVID-19 sanctions, Ukraine war and aggressive policy by the Fed.
Russia accused NATO of posing a serious threat of nuclear war by arming Ukraine in a proxy war as Washington and its allies met to pledge the heavy weapons Kyiv needed to win.
Twitter fell 1.8%, while Tesla fell 7.8% a day after the social media platform agreed to sell itself to Tesla Inc chief Elon Musk.
At 10:16 a.m. ET, the Dow Jones Industrial Average was down 304.51 points, or 0.89%, at 33,744.95, the S&P 500 was down 59.42 points, or 1.38%, at 4,236.70, and the Nasdaq Composite was down 318.95 points, or 2.45 points. %, at 12,685.90.
Of the 134 companies in the S&P 500 that have reported earnings so far, 80.6% topped analysts’ profit expectations, according to Refinitiv data. In a normal quarter, 66% beat estimates.
United Parcel Service Inc. slipped 3.6% despite reporting an increase in quarterly adjusted profit, while US hospital operator Universal Health Services Inc. fell 11.1% after missing its earnings estimates.
General Electric Co. fell 9.8% after projecting full-year earnings at the low end of its previous estimate.
Meanwhile, data showed US consumer confidence eased in April, although households planned to buy automobiles and multiple appliances, which should help moderate consumer spending in the second quarter.
The decline issues in the number of advances to a 2.91-to-1 ratio on the NYSE and a 3.32-to-1 ratio on the Nasdaq.
The S&P index recorded 1 new 52-week high and 27 new lows, while the Nasdaq recorded 17 new highs and 312 new lows. (Reporting by Bansari Mayur Kamdar in Bengaluru; Editing by Maju Samuel and Anil D’Silva)
This story has been published without modification in text from a wire agency feed.