Tech losses halt S&P 500’s three-day rally with mixed earnings results
On Thursday, the stock market took a hit as major tech companies saw declines in their stock prices. The S&P 500 fell by 0.21 percent to 5,937.34, ending a three-day positive streak. The Nasdaq Composite dropped by 0.89 percent to 19,338.29, and the Dow Jones Industrial Average saw a loss of 68.42 points or 0.16 percent, closing at 43,153.13.
A significant drop was observed in the stock prices of leading tech companies. Apple shares experienced a sharp decline of 4 percent, making it their worst performance since August 5. Similarly, Tesla saw a decline of over 3 percent, Nvidia fell by almost 2 percent, and Alphabet slipped by approximately 1 percent.
Despite the overall dip in the market, strong corporate earnings initially boosted the major averages. Morgan Stanley outperformed earnings expectations, leading to a 4 percent increase in their stock value. Bank of America also exceeded estimates, but its shares decreased by about 1 percent. Positive earnings results were also reported by JPMorgan Chase and Goldman Sachs, surpassing fourth-quarter projections.
Of the companies that have reported their earnings so far, FactSet revealed that 77 percent had exceeded expectations. Keith Buchanan, a senior portfolio manager at Globalt Investments, noted a sense of caution among investors, stating that there was a feeling of “heaviness” and “exhaustion” in the market as it awaited the next positive move.
Commenting on the banking sector, Buchanan highlighted the positive performance of banks in the latest earnings reports but emphasized the need for more positive triggers beyond just the banking sector. The recent rally on Wall Street was followed by significant losses on Thursday, pulling the market down after a strong session the previous day.
In Wednesday’s trading session, the Dow surged by more than 700 points, while the S&P 500 and Nasdaq saw gains of 1.8 percent and 2.5 percent, respectively. The upturn was attributed to an improvement in December’s core inflation data and robust earnings from major US banks. The 10-year US Treasury yield also witnessed a significant decline from a 14-month high, settling near 4.615 percent after reaching record numbers earlier in the week.
