Major indexes fell to session lows in afternoon trading. The Dow Jones Industrial Average was down 0.8% at 1:30 p.m. ET Tuesday, ahead of Big Tech earnings news. Several tech stocks posted sell signals ahead of earnings.
Healthcare stocks advanced as Dow (DOW) fell after earnings.
The S&P 500 fell 1.2% and the Nasdaq lost even more in the early afternoon, falling 1.5%. Fiserv (FISV) and PepsiCo (PEP) acquired after earnings. Bank of the First Republic (FRC) plunged.
Volume on the NYSE rose and fell on the Nasdaq from the same time Monday.
Crude oil fell more than 2% to $76.84 a barrel. The yield on the benchmark 10-year Treasury fell 7 basis points to 3.44%. The small-cap Russell 2000 fell almost 2% in the afternoon.
The Dow Jones Transportation Average lost more than 3% after the component United Parcel Service (UPS) missed first-quarter estimates and lowered its full-year 2023 guidance.
UPS stock fell more than 9% in the afternoon. The Miss raises fears of a major slowdown in the US economy.
Elsewhere, housing remained strong in March, but consumer confidence weakened. The Conference Board’s consumer confidence index fell to 101.3 in April from 104.0 in March. Comerica analysts predict a mild recession over the next 12 to 18 months.
A pivot to rate cuts after a hike in May depends on how quickly inflation cools and wage growth moderates. The probability of a 25 basis point hike next week stands at 84%, according to the CME FedWatch Tool.
FANG Stocks, Dow Jones leader on deck
Three FANG stocks are on deck this week.
Earnings for Google parent Alphabet (GOOGL) are due after market close, as well as Microsoft(MSFT). Parent Facebook Metaplatforms (META) is on deck on Wednesday, with Amazon (AMZN) ending Thursday.
GOOGL is up 20% year-to-date, while MSFT has seen a 17% gain. Amazon booked 26% upside, but Meta leads the pack, rallying an incredible 75%. The META stock is on the IBD ranking. The S&P 500 gained just over 7% during the period while the Nasdaq posted a 16% gain.
Slowing ad sales and news about how chatbots will change online search will be on the prowl for GOOGL. Investors also want to know about recent layoffs from the Mountain View, Calif.-based company. Azure cloud revenue amid cooling PC demand will give clues to Microsoft’s sales in 2023.
Analysts polled by FactSet see Alphabet’s sales flat from a year ago by $68.8 billion, with earnings down $1.08 per share. Microsoft is expected to post revenue growth of just 3% to $51 billion and nearly flat earnings of $2.24 per share.
Stocks move today
Shares of General Motors (GM) fell despite strong earnings growth and higher guidance for the full year. Dow Jones component McDonald’s (MCD) also fell slightly after the earnings. MCD stock is in a buy zone above an entry of 281.77.
Shares of First Republic Bank tumbled after the bank said it lost $72 billion in the first-quarter bank run. PepsiCo raised its revenue forecast after earnings on Tuesday and is trading up nearly 2.5% in the afternoon.
Tech stocks set off fireworks of sell signals on Tuesday.
IBD 50 component Cadence Design Systems (CDNS) fell sharply after earnings, crossing the 50-day line and triggering a sell signal. Rambus (RMBS) also fell below its 50-day line, as did Palo Alto Networks (PANW), both ahead of May results. Advanced micro-systems (AMD) triggered a round-trip sell signal ahead of earnings on May 2.
Dow Jones component Visa (V) is under watch as it sits near an entry at 227.51 with profits expected later in the day.
Phase (ENPH) is also due. Shares crossed the 50-day line ahead of earnings.
You’re here (TSLA) was stable in the afternoon after the recent losses. Ark Invest founder Cathie Wood predicts the stock will hit $2,000 by 2027 thanks to the growth of robotaxis. Ark’s bullish scenario sees robotaxis accounting for two-thirds of Tesla’s enterprise value, making the electric vehicle giant an $8 trillion megacap.
Earnings on deck
Dow Jones component Boeing (BA), ServiceNow (NOW) and KLA (KLAC) are lined up for profit on Wednesday.
NOW the stock is carving a handful with a possible entry of 485.68.
Dow Jones Components Intel (INTC) and caterpillar (CAT) are expected on Thursday, along with SwingTrader stocks Crocodile (CROX).
INTC is testing support on the 50 day line. CAT is in a downtrend and below the key 50-day line. CROX is in a buy zone above an entry of 143.60.
Please follow Ramakrishnan on Twitter for more news on the stock market today.
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