US close: Stocks finish weaker on big tech disappointments
Trading finished mostly below the waterline in the US on Wednesday, after weaker-than-expected third-quarter earnings from Alphabet and Microsoft weighed on sentiment.
At the close, the Dow Jones Industrial Average was up 0.01% at 31,839.11, while the S&P 500 lost 0.74% to 3,830.60 and the Nasdaq Composite was off 2.04% at 10,970.99.
The Dow closed just 2.37 points higher on Wednesday, barely extending Tuesday’s gains as investors thumbed through data and earnings from some of the nation's biggest tech firms.
“US markets initially saw a mixed open with the Nasdaq leading the losses after both Microsoft and Alphabet’s latest quarterly numbers prompted a negative reaction after hours, and which has resulted in sharp falls for both on the open, although we have seen a bit of a turnaround in the wake of the Bank of Canada decision,” said CMC Markets chief market analyst Michael Hewson.
“The Bank of Canada raised rates by a less-than-expected 50-basis bps to 3.75%, in a move that suggests that central banks are starting to wake up to the possibility that too aggressive rate rises could do more harm than good.
“It’s also got markets asking the question, could the Fed follow suit next week after another poor set of housing numbers from the US?”
On the economic front, mortgage applications fell 1.70% week-on-week in the seven days ended 21 October, according to the Mortgage Bankers Association of America, marking a fifth consecutive drop amid continued increases in borrowing costs.
Elsewhere, America's shortfall on trade in goods with the rest of the world widened unexpectedly during the previous month amid a drop in exports.
According to preliminary figures from the Department of Commerce, in seasonally adjusted terms, the so-called visible trade deficit increased at a month-on-month pace of 5.7% to reach -$92.2bn.
Economists had pencilled in a print of -$87.8bn.
On another note, building permits increased 1.4% month-on-month in September to an annualised clip of 1.56m, according to the Census Bureau, in line with preliminary estimates.
Finally, new home sales decreased to 603,000 in September, according to data also from the Census Bureau, down from 677,000 a month earlier.
In equities, Google parent Alphabet tumbled 9.63% after the tech giant fell short of expectations on both the top and bottom lines, and posted a decline in YouTube advertising revenue.
Microsoft was 7.72% weaker after it delivered cloud revenue that failed to meet consensus, despite beating both earnings and revenue estimates, and also provided current-quarter revenue guidance that fell short of expectations.
On the upside, Visa was ahead 4.6% after the credit card behemoth beat quarterly earnings expectations, with payment volumes growing 10% in its fourth quarter.
Facebook parent Meta Platforms reported a dire set of numbers after the close, meanwhile, with third quarter earnings more than halving to $4.39bn from $9.2bn.
That was on the back of total sales of $27.17bn, down from $29bn year-on-year, while earnings per share came in at $1.64 per share, well below the $1.90 expected by analysts.
Meta shares ended the session down 5.59%, and were then 18.75% weaker in after-hours action.
Reporting by Josh White for Sharecast.com. Additional reporting by Iain Gilbert.
Dow Jones - Risers
Visa Inc. (V) $203.28 4.60%
3M Co. (MMM) $122.70 3.54%
Amgen Inc. (AMGN) $266.66 2.57%
International Business Machines Corporation (CDI) (IBM) $134.97 1.56%
Chevron Corp. (CVX) $177.09 1.23%
JP Morgan Chase & Co. (JPM) $124.04 1.15%
Caterpillar Inc. (CAT) $196.96 1.09%
Goldman Sachs Group Inc. (GS) $335.69 0.99%
Johnson & Johnson (JNJ) $172.23 0.88%
Walmart Inc. (WMT) $141.16 0.76%
Dow Jones - Fallers
Boeing Co. (BA) $133.79 -8.77%
Microsoft Corp. (MSFT) $231.32 -7.72%
Salesforce.Com Inc. (CRM) $159.91 -3.24%
Apple Inc. (AAPL) $149.35 -1.96%
Intel Corp. (INTC) $27.21 -0.73%
American Express Co. (AXP) $146.88 -0.10%
Home Depot Inc. (HD) $290.15 -0.04%
Walgreens Boots Alliance, Inc. (WBA) $35.51 -0.03%
Verizon Communications Inc. (VZ) $36.43 0.00%
Dowdupont Inc. (DWDP) $0.00 0.00%
S&P 500 - Risers
Universal Health Services Inc. (UHS) $109.39 13.13%
Harley-Davidson Inc. (HOG) $41.81 12.61%
Helmerich & Payne Inc. (HP) $49.19 11.19%
Rollins Inc. (ROL) $39.55 10.04%
Freeport-McMoRan Inc (FCX) $33.34 5.27%
Ameriprise Financial Inc. (AMP) $292.50 5.12%
Hess Corp. (HES) $142.29 4.82%
Visa Inc. (V) $203.28 4.60%
Halliburton Co. (HAL) $36.48 4.29%
DaVita Inc (DVA) $99.19 4.05%
S&P 500 - Fallers
Assurant Inc. (AIZ) $136.75 -10.47%
Alphabet Inc. Class C (GOOG) $94.82 -9.63%
Alphabet Inc. Class A (GOOGL) $94.93 -9.14%
Boeing Co. (BA) $133.79 -8.77%
Seagate Technology Plc (STX) $53.39 -7.95%
Avery Dennison Corp. (AVY) $163.24 -7.78%
Microsoft Corp. (MSFT) $231.32 -7.72%
F5 Inc. (FFIV) $142.39 -7.22%
Chipotle Mexican Grill Inc. (CMG) $1,476.03 -6.82%
Masco Corp. (MAS) $45.57 -5.73%
Nasdaq 100 - Risers
JD.com, Inc. (JD) $41.04 8.66%
Trip.com Group Limited (TCOM) $23.32 6.58%
Baidu Inc. (BIDU) $84.19 3.67%
Illumina Inc. (ILMN) $237.34 3.14%
NetEase Inc. Ads (NTES) $58.82 2.62%
Netflix Inc. (NFLX) $298.62 2.61%
Amgen Inc. (AMGN) $266.66 2.57%
Biogen Inc (BIIB) $280.43 2.51%
Henry Schein Inc. (HSIC) $71.17 2.15%
DENTSPLY Sirona Inc. (XRAY) $30.88 1.88%
Nasdaq 100 - Fallers
Alphabet Inc. Class C (GOOG) $94.82 -9.63%
Alphabet Inc. Class A (GOOGL) $94.93 -9.14%
Seagate Technology Plc (STX) $53.39 -7.95%
Microsoft Corp. (MSFT) $231.32 -7.72%
Meta Platforms Inc. (META) $129.82 -5.59%
Amazon.Com Inc. (AMZN) $115.66 -4.10%
Mercadolibre Inc. (MELI) $833.36 -3.43%
Analog Devices Inc. (ADI) $141.38 -3.41%
Microchip Technology Inc. (MCHP) $62.57 -2.96%
Nvidia Corp. (NVDA) $128.96 -2.75%