Home Market News Nasdaq futures fall behind S&P as Alphabet underwhelms

Nasdaq futures fall behind S&P as Alphabet underwhelms

Nasdaq futures fall behind S&P as Alphabet underwhelms

Stock index futures showed a mixed performance on Wednesday as investors grappled with contrasting news in the tech world. S&P futures were down 0.4%, while Nasdaq 100 futures trailed behind with a 0.7% decrease. On the other hand, Dow futures managed to eke out slight gains.

Deutsche Bank’s Jim Reid highlighted the significance of two tech giants reporting after the market closes, stating, “When 10% of the market cap of the S&P 500 reports after the closing bell, across just two companies, then that’s the only place to start this morning.”

Microsoft’s post-earnings performance pleased investors, thanks to impressive growth in its Azure cloud division. However, Sophie Lund-Yates, lead equity analyst at Hargreaves Lansdown, noted that Microsoft’s personal computing segment continues to face headwinds and experiences a significant slowdown.

In contrast, Alphabet, the parent company of Google, experienced a more than 5% pre-market drop as its cloud revenue fell short of expectations.

The bond market displayed a relatively calm demeanor, with the 10-year yield rising 3 basis points to 4.87% while the 2-year yield fell 2 basis points to 5.08%.

During the previous session, market participants scaled back their expectations of rate cuts in 2024, resulting in a 10.5 basis point increase in December 2024 pricing and bringing the expected rate to 4.66%. This aligns with the recent theme of “higher for longer” emphasized by the Federal Reserve.

Federal Reserve Chairman Jay Powell delivered opening remarks for the Moynihan Lecture in Social Science and Public Policy in Washington after the market close. However, due to the Fed’s blackout period, Powell avoided discussing any monetary policy matters.

In economic news, the market awaited the release of September new home sales figures, with a consensus estimate projecting a slight rise to a rate of 680K.

On the global front, China announced fiscal stimulus measures by raising its deficit limit. UBS’ Paul Donovan commented that this move suggests concerns about growth momentum in 2024 or doubts regarding the accuracy of reported GDP figures in relation to living standards.