NEW YORK: Wall Street stocks saw a gloomy start on Wednesday, with shares in major tech companies retreating after Microsoft and Google parent Alphabet reported their quarterly financial results a day prior.
About 15 minutes into trading, the Dow Jones Industrial Average rose 0.3 percent to 38,584.75, while the broad-based S&P 500 slid 0.5 percent to 4,899.58.
The tech-focused Nasdaq Composite Index lost 1.2 percent to 15,328.96.
The slip comes despite Microsoft and Google delivering solid corporate earnings as demand for artificial intelligence services stoked revenue.
Wall St tepid ahead of Fed decision
Both had reported results after the closing bell on Tuesday.
Microsoft shares crept down 0.3 percent in early trading and Alphabet slumped 6.2 percent.
The losses were “because expectations were sky high, evidenced by the huge gains the stocks had logged ahead of their reports,” said Patrick O’Hare of Briefing.com in a note.
This has contributed to “backtracking in other leadership stocks,” he said.
Other major names like Nvidia lost 1.7 percent, while Amazon and Facebook parent Meta also fell.
But O’Hare noted the broader market was not “coming unglued because of the weakness in those leadership stocks.”
On Wednesday morning, private employment data by payroll firm ADP also indicated that hiring slowed more than expected in January.
This is likely good news for the Federal Reserve, with officials due to announce a monetary policy decision later in the day.
Analysts expect central bank policymakers to leave the benchmark lending rate unchanged, but are also seeking clues on when an eventual rate cut might happen.
Boeing shares were lifted 3.6 percent after its results topped estimates and it committed Wednesday to boost quality control.
But electric car maker Tesla fell 1.0 percent, after a judge ruled against Elon Musk’s $56 billion compensation package.
This week, analysts are also looking towards the government’s employment report due Friday.
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