Big drops in tech giants weigh on stocks on Wall Street

NEW YORK (AP) — Shares got off to a mixed start on Wall Street, as large declines in several heavyweight tech stocks weighed on major indices and offset gains elsewhere in the market.

The S&P 500 was little changed as of 10:40 am ET after shaking off an early decline. The tech-heavy Nasdaq fell 0.5% and the Dow Jones Industrial Average rose 136 points, or 0.4%, to 31,959.

Technology stocks, with their huge valuations, can have a major impact on market indices. The decline in big tech companies weighed on the S&P 500, although 80% of shares were higher.

Google’s parent Alphabet slumped 7.2% after reporting disappointing third-quarter financial results as advertising sales faltered. Weak ad sales threaten other technology and communications companies. Music-streaming service Spotify fell 8% after reporting a bigger loss than Wall Street had expected in the third quarter.

The broader market was also dragged down by Microsoft’s 7% decline after the company reported disappointing growth for its cloud-computing business, while profits fell along with PC sales. Chipmaker Texas Instruments fell 3.5% after giving investors a disheartening forecast for the current quarter.

Several other big tech companies are on deck to report earnings this week. Facebook’s parent company Meta will report results later on Wednesday, while Apple reports its results on Thursday.

Internet retail giant Amazon released its results on Thursday along with industry leaders Caterpillar and McDonald’s.

Long-term government bond yields fell further from their multi-year highs. Gains in these interest rates have pushed mortgage rates up sharply this year.

The yield on the 10-year Treasury fell to 4.02% from 4.10% late Tuesday. The two-year yield fell to 4.40% from 4.48%.

Home builders gained ground after an encouraging report on new build home sales. Lennar rose 1.4%.

Investors are primarily focused on earnings this week but are awaiting multiple economic updates as they try to get a better picture of how inflation is affecting businesses, consumers and the Fed’s plans for rate hikes.

The government will release its first estimate of third-quarter gross domestic product on Thursday. On Friday, the government will release more data on personal income, consumption and spending.


Joe McDonald and Matt Ott contributed to this report.

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