US stock futures fell on Wednesday after disappointing third-quarter results from Alphabet and weak revenue guidance from Microsoft, marking a harbinger of earnings for major tech companies this week.
S&P 500 and Nasdaq 100 futures declined 0.7% and 1.7%, respectively. Dow Jones Industrial Average futures lost 27 points, or 0.1%, with Visa supporting the index after exceeding expectations on earnings and revenue when reporting fourth-quarter earnings.
Wednesday’s early performance is a turnaround from the past three days of rallying for major indices. On Tuesday, the Nasdaq closed up 2.2%, while the S&P 500 and Dow added 1.6% and 1.1%, respectively. Tuesday’s close marked the first time in October that major indexes rebounded three days in a row.
Shares of Google subsidiary Alphabet fell 6% in the primary market. Internet search giant Missed expectations on the final result. Alphabet also reported a drop in YouTube ad revenue, which prompted investors to discuss the prospects for other tech companies that rely on ad spend.
Meanwhile, Microsoft stock fell about 6% after that The tech giant reports weaker-than-expected cloud revenue In its latest quarterly results, though, it beat earnings and revenue estimates. The company also issued guidance on current quarter revenue that did not live up to expectations.
“I think we have to take a big picture perspective and realize that nobody is really immune in this market, there’s a slowdown in spending,” Sand Hill Global Advisors Brenda Vengelo said Tuesday on CNBC’s “Closing Bell: Overtime.” on digital advertising.
Shares of other big tech companies fell in after-hours trading on the back of Alphabet and Microsoft as investors focus on technology this week. Meta Platforms shares are down 4% and Amazon is down 3.8%.
Mixed bag So far, corporate earnings season continues on Wednesday. Shares of Kraft Heinz soared after the company announced that it beat revenue and earnings per share expectations before the bell. Meta was among the companies scheduled to report.
Mortgage applications fell as interest levels continued to drive demand, according to weekly data released on Wednesday. Traders are also watching the latest economic data on weekly wholesale inventories and new home sales.
Bond yields keep going back Exit from a volatile trading period.