NEW YORK CITY, RAW – Wall Street has ended lower with Amazon, Apple, Alphabet and other tech-related companies weighing on the S&P 500 and Nasdaq despite recent strong quarterly earnings reports.
A day after the S&P 500 closed at a record high, Apple, Google-parent Alphabet and Facebook each gave back gains following upbeat quarterly reports this week.
Amazon.com Inc ended down 0.1 per cent after it posted record profit late on Thursday and signalled that consumers would keep spending in a growing US economy.
Amazon had been up more than 2.0 per cent earlier in the session.
Twitter Inc plunged 15 per cent after it offered a tepid revenue forecast for the second quarter, saying user growth could slow as the boost seen during the pandemic fizzles.
While megacap favourites posted largely strong earnings in the first quarter, their shares have struggled to maintain the upward trajectory that many had coming into reporting season.
“There is a sense that maybe next quarter is as good as it’s going to get, and we’re going to roll over, particularly among the Nasdaq stocks and Big Tech stocks that benefited from the pandemic,” said Jack Ablin, chief investment officer at Cresset Wealth Advisors in Palm Beach, Florida.
Seven of the 11 major S&P 500 sector indexes fell, with technology and materials down more than 1.0 per cent and energy falling almost 3.0 per cent.
Of the 303 companies in the S&P 500 that have reported so far, 87 per cent have topped analysts’ earnings estimates, with Refinitiv IBES data now predicting a 46 per cent jump in profit growth.
Data on Friday showed US consumer spending rebounded in March amid a surge in income as households received additional COVID-19 pandemic relief money from the government.
The Dow Jones Industrial Average fell 0.54 per cent to end at 33,875.31 points while the S&P 500 lost 0.72 per cent to 4,181.21 and the Nasdaq Composite dropped 0.85 per cent, to 13,962.68.
Despite Friday’s weakness, the Nasdaq completed its sixth consecutive month of gains, rising 5.4 per cent in April.
The Dow added 2.7 per cent in April while the S&P 500 rose 5.2 per cent, both gaining for a third month in a row.
For the week, the S&P 500 was about flat, the Dow lost 0.5 per cent and the Nasdaq shed 0.4 per cent.
Chevron Corp dropped 3.6 per cent after its first-quarter profit fell 29 per cent, hit by weaker refining margins and production losses.
AbbVie Inc rose 0.5 per cent after it reported strong results and raised its 2021 earnings forecast, helped by demand for its rheumatoid arthritis drug in the United States.
Declining issues outnumbered advancing ones on the NYSE by a 2.13-to-1 ratio; on Nasdaq, a 2.13-to-1 ratio favoured decliners.
The S&P 500 posted 52 new 52-week highs and no new lows; the Nasdaq Composite recorded 84 new highs and 45 new lows.
Volume on US exchanges was 10.3 billion shares, compared with the 9.8 billion full-session average over the last 20 trading days.