Dow Plummets 200+ Despite Blowout Earnings from Tech
July 31,2020 12:23 pm EST
Stocks fell on Friday even after the biggest tech companies and market leaders — Amazon, Apple and Facebook — reported stellar quarterly results.
The Dow Jones Industrials let go of 210.76 points by noon hour to 26,102.89.
The S&P 500 dipped 13.8 points to 3,232.43.
The NASDAQ gained 26.31 points, off its highs of the morning, to 10,614.13.
A few negative headlines weighed on the broader market despite the blowout numbers from major tech companies.
Emergency unemployment benefits are set to expire Friday and Congress and the White House still seem far apart on an agreement.
Dow-component Chevron fell more than 4% after the oil giant reported an $8.3-billion loss in the second quarter as the pandemic "significantly reduced demand."
Stocks linked to an economic recovery like banks and retailers were lower as investors assessed the biggest quarterly gross domestic product contraction on record and persistently weak job growth. JPMorgan and Home Depot were both in the red.
There could be a so-called “sell-the-news” effect now that technology companies have delivered strong results to back up their market-leading run.
Apple reported a blowout quarter, sending shares up more than 6%. The company said its overall sales expanded by 11%, and Apple also announced a four-for-one stock split.
Amazon, meanwhile, traded 5% higher as the company saw its sales skyrocket during the coronavirus pandemic. Facebook shares rallied more than 7% as the social media giant posted revenue growth of 11% even amid the coronavirus pandemic slowdown. The company also issued stronger-than-expected sales guidance for the current quarter.
Google-parent Alphabet also posted better-than-expected earnings, but the company''s overall revenue declined for the first time in its history. Revenue for Google Cloud was also just below analyst expectations. Alphabet shares fell more than 4%.
Collectively the four stocks were set to add about $200 billion to their total market cap, bringing it to more than $5 trillion combined.
Big Tech has been the stalwart on Wall Street this year. Amazon has climbed 65% and Apple is up 31% in 2020. Facebook and Alphabet have risen more than 14% over that time period.
Prices for the 10-Year Treasury backpedaled slightly, raising yields to 0.55% from Thursday''s 0.54%. Treasury prices and yields move in opposite directions.
Oil prices swooned six cents to $39.86 U.S. a barrel.
Gold prices revived $23.50 to $1,990.30 U.S. an ounce.