The stock market closed on a mixed note on Wednesday, despite the impressive quarterly results of Microsoft and Alphabet that kicked off the tech earnings season. The S&P 500 index slipped by 0.39% as investors expressed worries about the financial stability of regional banks. In contrast, the Nasdaq Composite gained 0.47% after tech giants Microsoft and Alphabet reported better-than-expected earnings and revenue for the last quarter.
Microsoft’s earnings beat estimates, with the tech giant indicating strong growth in its AI and cloud businesses. The company’s revenue climbed to $52.9 billion, from $49.4 billion for the same period last year, sending its stock price up by over 7%. However, Microsoft’s attempt to acquire Activision Blizzard hit a snag after UK regulators blocked the deal over competition concerns, causing Activision’s stock price to tumble by around 12%.
Alphabet’s first-quarter earnings showed a 2% increase in search revenues, which was lower than the corresponding quarters in the past two years. Nonetheless, the company’s installation of the Bing app quadrupled after it was augmented by AI. Despite the mixed results, Alphabet’s stock price remained stable, and management expressed confidence in the company’s future.
Tech titans Microsoft (MSFT) & Alphabet (GOOGL) report earnings after hours tomorrow. Tune in to find out if it’s good or bad news & check the stock market at 9:30AM. #stocks #investing #MSFT #GOOGL https://t.co/ylnUqfj61I
— Furu Alerts (@furualerts) April 24, 2023
While the Nasdaq Composite rallied, analysts predict that the technology sector, which has been the driving force of the equities rally this year, could face selling pressure as it loses momentum. Investors remain cautious that earnings growth expectations might not be met, and some market strategists anticipate a pullback that has yet to materialize.
Meta (formerly Facebook) is set to release its earnings after Wednesday’s bell, while Amazon’s report is expected on Thursday. Investors are closely monitoring these tech giants’ financial reports as they could provide further insights into the sector’s overall health.
Microsoft and Alphabet’s impressive earnings results were overshadowed by concerns about the stability of regional banks, leading to mixed results in the broader equities market.