March 22, 2023

Live stock market updates: Dow rises after GDP data, tech shares weigh on Nasdaq, S&P 500

U.S. stocks were mixed on Thursday as investors braced for another round of tech earnings from Amazon ( AMZN ) and Apple ( AAPL ) and analyzed a better-than-expected U.S. GDP report.

The Dow Jones Industrial Average (^DJI) and the tech-heavy Nasdaq Composite (^IXIC) diverged, with the Dow up 0.62% and the Nasdaq down 1.63%. Tech stocks also dragged down the S&P 500 (^GSPC), which fell 0.6%.

Stocks had risen to start the week on positive signals that Federal Reserve officials were concerned about the pace of rate hikes ahead of the November meeting, as well as better-than-expected third-quarter earnings.

But the rally ended amid two lackluster reports from Alphabet ( GOOGL ) and Microsoft ( MSFT ) that raised concerns about slowing economic growth.

Big Tech’s struggles continued on Wednesday and Thursday. Facebook’s parent company Meta Platforms (META) released its second quarterly revenue report. It’s still rocky. Meta’s stock fell more than 24% at the close.

“Look, there’s still a lack of technology everywhere. And they’re a disappointment — I think the biggest disappointment is the expense,” Jefferies senior analyst Brent Thill told Yahoo Finance Live on Wednesday after Meta’s results.

“I think everyone wants Zuckerberg to put the brakes on things going forward. The fact that they’re keeping headcount flat is good, but I think everyone is calling for more drastic measures to cut headcount and cut costs to get a handle on what’s going on in this macro storm,” Thill added.

Later Thursday, Amazon ( AMZN ) posted after-hours earnings and reported revenue that fell short of Wall Street estimates. Amazon shares fell nearly 20% after hours. Intel ( INTC ), meanwhile, cut a year after revising its revenue guidance.

A report from the Commerce Department on Thursday offered more positive news on the US economy, showing that the country’s gross domestic product grew at an annual rate of 2.6 percent between July and September after two consecutive quarters of negative growth. Economists polled by Bloomberg had estimated a rise of 2.4 percent.

“All GDP growth was driven by a huge swing in net foreign trade, which accounted for 2.8 percentage points, while domestic final demand rose just 0.5 percent,” Ian Shepherdson, chief economist at Pantheon Macroeconomics, wrote in a statement.

Also on the results side on Thursday:

  • Southwest Airlines (LICENSE): The airline released its results ahead of the bell, forecasting higher fourth-quarter revenue growth as travel demand remains strong.

  • Shopify (STORE): The The e-commerce company reported a smaller-than-expected quarterly loss, while revenue exceeded expectations after adding more opportunities for merchants to sell and promote their products.

  • Caterpillar Inc. (CAT): The construction machinery manufacturer’s result exceeded expectations even despite the slowdown in sales growth in Asia.

  • McDonald’s (MCD): The fast-food chain exceeded Wall Street’s estimates for third-quarter earnings and revenue, despite currency fluctuations.

  • shell (SHELL): The British oil company reported quarterly profit that more than doubled compared to the same period last year. The oil giant announced that it would buy back $4 billion worth of shares and increase its dividend by 15 percent.

  • Credit Suisse (CS): The Swiss posted a $4 billion loss as the investment bank undergoes a radical overhaul over the next three years.

  • Mastercard (Mon): The payment giant exceeded expectations with the latest revenue and profit figures, as strong consumer spending and a return to travel strengthened the result amid fears of a recession.

  • Comcast (CMCSA): The cable and entertainment giant reported quarterly earnings that beat analysts’ estimates as it grapples with industry headwinds. The company said it added just 14,000 broadband subscribers in the third quarter and saw ad revenue drop because there was no telecast of the Olympics this year.

  • Honeywell International (HON): The conglomerate raised its profit forecast for the whole year and expressed confidence in the demand outlook amid economic headwinds.

Apple ( AAPL ) is next on deck to report earnings after the bell on Thursday.

Wall Street also had a dramatic deal to buy Twitter. Elon Musk visited Twitter’s headquarters ahead of Friday’s deadline as banks begin sending $13 billion, the Wall Street Journal reported. The move indicates that the deal is nearing completion.

“Twitter’s $44 billion price tag ranks as one of the most overpaid tech acquisitions in the Street’s M&A history, in our view,” Wedbush Securities analyst Dan Ives wrote in a note to clients. “At a fair value we’d peg at around $25 billion, buying Twitter for Musk remains a major head-scratcher that he ultimately couldn’t get rid of, according to the Delaware courts.”

The yield on the 10-year Treasury note was around 4%, down from 4.291% on Monday. The dollar gauge rose after two consecutive days of decline.

In the energy market, Brent crude oil, the international benchmark for oil prices, rose 1.13% to 96.77 dollars per barrel.

Elsewhere, the European Central Bank raised interest rates by 75 basis points to 2.0 percent, the highest level since 2008. The ECB expects to raise rates at its next meetings.

Dani Romero is a reporter for Yahoo Finance. Follow him on Twitter @daniromerotv

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