S&P 500, Nasdaq stumble on caution ahead of tech earnings
Nasdaq closed lower on Tuesday, weighed down by weak chip and megacap shares ahead of earnings from heavyweight tech companies this week, but the Dow managed modest gains.
Microsoft, seen by many as leading the artificial intelligence race, fell 0.89% to $422.92 ahead of its quarterly results. After the closing bell, the software maker dropped about 5% after reporting results that missed expectations for quarterly growth in its Azure cloud-computing service.
Chipmaker Nvidia, regarded as a prime beneficiary of potential AI growth and the year's second best S&P 500 performer, tumbled 7.04% to $103.73, weighing on other chip stocks to pull the Philadelphia semiconductor index down 3.88%.
Other megacap names such as Apple, Amazon.com and Meta Platforms, are all due to report earnings this week. Apple edged up 0.26% to $218.80, but Amazon slipped 0.81% to $181.71 and Meta shed 0.54% to $463.19 on valuation concerns.
«A lot of people are looking at artificial intelligence now and saying this is all great but I how do I make money on it,» said Stephen Massocca, senior vice president at Wedbush Securities in San Francisco.
«Financially the companies are probably doing quite well, but the question is what are you paying for this? These are not cheap stocks and so you need to go into these things with your eyes open.»
The Dow Jones Industrial Average rose 203.40 points, or 0.5%, to 40,743.33, the S&P 500 lost 27.10 points, or 0.5%, to 5,436.44 and the Nasdaq Composite lost 222.78 points, or 1.28%, to 17,147.42.
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