Microsoft Corp posted its weakest sales growth in five years and forecast second-quarter revenue below Wall Street estimates, while Alphabet reported falling ad sales and warned of a slowdown in ad spending.
Shares of both companies fell about 7.5%, dragging down Amazon.com and Apple, which are due to report results later this week and were down 4.0% and 1.3%, respectively.
“Microsoft’s results point to the idea that corporate IT budgets are under pressure, and Alphabet’s failure to meet estimates speaks to the consumer perhaps running out of money.” forces; both point to a slowdown in the economy”said Josh Wein, manager of Hennessy Funds.
Shares in social media company Meta Platforms fell 3.4%, while shares in Pinterest fell 1%.
Shares of US-listed Spotify Technology fell 7.0% as margins came under pressure from slowing ad growth, while Texas Instruments fell 3.9% after the maker The chip company offered a bleak outlook for the fourth quarter due to lower demand.
The big weakness in the technology sector comes despite a drop in the 10-year Treasury yield, which fell for the second day in a row on growing bets that the pace of interest rate hikes would slow.
Expectations of a less aggressive Federal Reserve have helped Wall Street’s main indices complete three consecutive sessions of gains, but the lackluster results and forecasts suggest that the central bank’s rapid interest rate hikes are slowing the economy.
Source: Ambito
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