(New York) The New York Stock Exchange ended down on Wednesday, hurt by Alphabet’s disappointing results and penalized, once again, by its dependence on a handful of technology stocks.
The Dow Jones fell 0.32%, the NASDAQ index lost 2.43% and the broader S index
The place was dragged down, from the opening, by the drop of Alphabet (-9.60%), Google’s parent company, sanctioned for having missed the target set by analysts for its remote computing activity (cloud computing).
This branch only represents a little more than 10% of the group’s turnover, but is considered its growth engine.
However, after posting a 28% increase in revenues (over one year) in the first and then the second quarters, Alphabet had to be content with 22% in the third.
Chief Executive Sundar Pichai said some Google customers have reduced spending on cloud computing amid uncertain macroeconomics.
These figures contrasted with those of its competitor Microsoft (3.07%), which has accelerated in the cloud.
“Microsoft did better than expected in the cloud, but the market chose to follow Google’s comments,” observed Steve Sosnick of Interactive Brokers. “That says a lot about the psychology” of the New York place.
He recalled that Tesla had experienced a fate similar to that of Alphabet a week ago (-9.3% over one session), after having also failed analysts.
“When you have a small group of stocks that are driving the market, with very high valuations, if they don’t meet expectations, they run the risk of dragging the entire market down,” says Steve Sosnick.
Weighted by Alphabet, the NASDAQ thus took on a dark red tone with, among the most affected, Amazon (-5.58%), cloud champion whose results are expected on Thursday, but also Nvidia (-4.31%), Meta (-4.17%) and semiconductor manufacturers Broadcom (-3.57%), AMD (-5.52%), Intel (-5.09%) or Qualcomm (-4.21%) .
“The bond market didn’t help either” the stock indexes, Steve Sosnick added.
After easing at the start of the week, bond rates rebounded on Wednesday. The yield on 10-year US government bonds rose to 4.94%, compared to 4.82% the day before at the close.
Wall Street paid little attention to the election, after three weeks of unsuccessful attempts, of a new speaker in the House of Representatives, in the person of Republican Mike Johnson.
“In theory, this should have taken some uncertainty out of the market, but it didn’t,” commented Steve Sosnick. “That says there’s always some nervousness. Congress still has much work to do. »
The American parliament must therefore adopt a federal budget by November 17, failing which the government will have to suspend part of its activities, a mechanism called “shutdown”.
On the stock market, Boeing fell (-2.54%) after announcing a quarterly net loss higher than expectations and a downward revision in the delivery rate of its 737 aircraft.
The aircraft manufacturer nevertheless confirmed its cash flow estimate for the entire financial year, as well as its forecast for deliveries of 787 for the year.
Snap (-5.36%) did not benefit from a return to growth (5%), after two consecutive quarters of decline in turnover.
The parent company of the social network Snapchat nevertheless continues to post heavy losses. She also warned that many advertisers suspended their advertising spending after the outbreak of war between Israel and Hamas.