• Investing
  • Stock
Round Table Thoughts
  • Economy
  • Editor’s Pick
Home Editor's Pick Stock market has worst day since 2022 as Tesla, Google parent Alphabet sink
Editor's Pick

Stock market has worst day since 2022 as Tesla, Google parent Alphabet sink

by July 25, 2024
by July 25, 2024 0 comment
Share
0
FacebookTwitterPinterestWhatsapp

U.S. stocks had their worst day since 2022 on Wednesday amid a broad pullback in tech companies as Wall Street traders sought to reduce their exposure to firms that have made big bets on artificial intelligence.

The tech-heavy Nasdaq index closed down 3.6%, while the broader S&P 500 index closed down 2.3% — both their worst performances in more than 18 months. The Dow Jones Industrial Average fell 1.25%.

The rout was led by Tesla, whose shares fell 12.3% for its worst day since 2020, and Google parent Alphabet, which fell more than 5% for its worst day since January.

Tesla reported Tuesday afternoon that its auto revenues fell 7% compared with the previous quarter, and CEO Elon Musk said in a follow-up earnings call that the company’s planned robotaxi rollout would be pushed back.

Although Alphabet reported earnings Tuesday that were in line with analysts’ expectations, traders appeared to seize on remarks CEO Sundar Pichai made on the company’s earnings call that signaled the tech world’s booming investments in artificial intelligence were not going to pay off in a short time frame.

‘I think we are in this phase where we have to deeply work and make sure on these use cases [for AI products], on these workflows, we are driving deeper progress on unlocking value, which I’m very bullish will happen,’ Pichai said. ‘But these things take time.’

Steve Sosnick, chief strategist at Interactive Brokers financial group, said Wall Street took that as a signal to sell off shares that had enjoyed the frenzied growth that tech stocks have been experiencing in recent months.

‘We’re seeing some nervous profit-taking in some of the stocks that have been leveraged to AI that a lot of investors have come to rely on as a consistent source of stock market gains,’ Sosnick told NBC News.

Alphabet also reported weaker-than-expected ad revenue from YouTube, which Google has owned since 2006.

Other major tech names having major losses Wednesday included Nvidia, the computer chip maker powering much of the AI revolution, whose shares fell more than 6% for their worst day since 2022; Facebook parent Meta was down 5%; Microsoft fell 3.5%; and Amazon lost 3%.

The major indices have been on a relatively consistent and positive run. Even after Wednesday’s dip, the S&P 500 remains up 13.8% in 2024, with the Nasdaq up 15.5% and the Dow up 5.7% in that time.

Wednesday’s sell-off comes amid renewed expectations for an interest-rate cut from the Federal Reserve in response to a slowing economy. While traders now say the Fed’s first cut of the post-pandemic period is virtually guaranteed by September, former Federal Reserve Bank of New York President Bill Dudley wrote Wednesday that the Fed needs to strongly consider announcing a cut at its meeting next Wednesday.

‘Although it might already be too late to fend off a recession by cutting rates, dawdling now unnecessarily increases the risk,’ Dudley, now an executive at UBS financial group, wrote in a column for Bloomberg News.

Sosnick said Wednesday’s stock sell-off was not a total referendum on the broader state of the economy. Year to date, the S&P 500 has still had healthy gains of about 15%, while the Nasdaq is up about 18% and the Dow Jones Industrial Average is up 6%.

‘This is much more about a little bit of vertigo in names that have climbed a lot this year,’ Sosnick said.

But signs of a broader economic pullback continue to mount: The U.S. unemployment rate is rising, excess savings from the pandemic have been exhausted, and consumer borrowing stress is at fresh highs.

‘We expect relatively weak economic growth in the second half of 2024 and early 2025,’ Ian Shepherdson, chief economist at Pantheon Macroeconomics research group, wrote in a note to clients Wednesday.

This post appeared first on NBC NEWS
You Might Also Like
  • Summer box office bust? This season’s movie slate could put up the lowest haul in decades
  • On the sidelines of a pricier Kentucky Derby, the race is on for small-dollar spending
  • ETAG Tech Selects Atmosic’s Bluetooth Low Energy Solutions for its Electronic Shelf Label Portfolio
  • The new class war: A wealth gap between millennials
Share
0
FacebookTwitterPinterestWhatsapp

previous post
Chipotle has been on a hot streak with customers
next post
Six House Dems vote with GOP to condemn Kamala Harris for ‘border czar’ role

You may also like

Walmart managers can now earn $400,000 a year, no college...

February 1, 2024

7 ways that Starbucks CEO Brian Niccol plans to change...

November 1, 2024

JetBlue to leave Kansas City, trim service from Los Angeles...

March 21, 2024

UAW says it’s expanding strike to include major Ford truck...

October 12, 2023

Disgraced Theranos founder Elizabeth Holmes is booked into prison in...

May 31, 2023

With car repossessions and home foreclosures rising, some Americans are...

May 3, 2023

Gov. Gavin Newsom says he will provide residents rebates if...

November 25, 2024

Walmart, Chipotle and others feel the heat over prices

July 10, 2024

Home prices soar even higher in February, despite higher mortgage...

May 2, 2024

Ex-CEO of firm that merged with Trump Media accused of...

July 18, 2024

    Stay updated with the latest news, exclusive offers, and special promotions. Sign up now and be the first to know! As a member, you'll receive curated content, insider tips, and invitations to exclusive events. Don't miss out on being part of something special.


    By opting in you agree to receive emails from us and our affiliates. Your information is secure and your privacy is protected.

    Recent Posts

    • Krispy Kreme stock plunges after doughnut chain pauses McDonald’s rollout, pulls outlook

      May 8, 2025
    • Don’t Buy Robinhood Stock… Until You See This Chart Setup

      May 8, 2025
    • UnitedHealthcare sued by shareholders over reaction to CEO’s killing

      May 8, 2025
    • The Unpredictable Stock Market: How to Make Sense of It

      May 8, 2025
    • AMD CEO calls China a ‘large opportunity’ and warns against strict U.S. chip controls

      May 7, 2025

    Popular Posts

    • 1

      Trump-era China sanctions ended by Biden may be...

      June 27, 2024 2,632 views
    • 2

      Walz’s honeymoon with China gets fresh scrutiny as...

      August 9, 2024 2,339 views
    • 3

      Biden appointee played key role in recruiting Chinese...

      June 25, 2024 2,320 views
    • 4

      Shein’s global ambitions leaves some cybersecurity experts fearful...

      July 10, 2024 2,303 views
    • 5

      Harris VP pick spent years promoting research facility...

      August 29, 2024 2,186 views

    Categories

    • Economy (7,009)
    • Editor's Pick (2,066)
    • Investing (538)
    • Stock (2,530)

    Popular Posts

    • 1

      Trump-era China sanctions ended by Biden may be revived under new House GOP bill

      June 27, 2024
    • 2

      Walz’s honeymoon with China gets fresh scrutiny as Harris camp blasts ‘lying’ critics

      August 9, 2024
    • 3

      Biden appointee played key role in recruiting Chinese businesses to Delaware: ‘Longtime friends’

      June 25, 2024
    • 4

      Shein’s global ambitions leaves some cybersecurity experts fearful of Chinese spy threats

      July 10, 2024
    • 5

      Harris VP pick spent years promoting research facility that collaborated with ‘Chinese military company’

      August 29, 2024

    Latest News

    • Krispy Kreme stock plunges after doughnut chain pauses McDonald’s rollout,...

      May 8, 2025
    • Don’t Buy Robinhood Stock… Until You See This Chart Setup

      May 8, 2025
    • UnitedHealthcare sued by shareholders over reaction to CEO’s killing

      May 8, 2025

    Categories

    • Economy (7,009)
    • Editor's Pick (2,066)
    • Investing (538)
    • Stock (2,530)

    Disclaimer: RoundTableThoughts.com, its managers, its employees, and assigns (collectively “The Company”) do not make any guarantee or warranty about what is advertised above. Information provided by this website is for research purposes only and should not be considered as personalized financial advice. The Company is not affiliated with, nor does it receive compensation from, any specific security. The Company is not registered or licensed by any governing body in any jurisdiction to give investing advice or provide investment recommendation. Any investments recommended here should be taken into consideration only after consulting with your investment advisor and after reviewing the prospectus or financial statements of the company.

    Copyright © 2024 RoundTableThoughts.com. All Rights Reserved.

    Round Table Thoughts
    • Investing
    • Stock
    Round Table Thoughts
    • Economy
    • Editor’s Pick

    Read alsox

    Under Armour is laying off workers...

    May 17, 2024

    Home buyers to be spared broker...

    March 17, 2024

    The 30-year mortgage rate hits 7.48%,...

    August 22, 2023
    Sign In

    Keep me signed in until I sign out

    Forgot your password?

    Password Recovery

    A new password will be emailed to you.

    Have received a new password? Login here