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(Reuters) – The Nasdaq and the S&P 500 slipped on Wednesday as tech giant Alphabet (NASDAQ:GOOGL) slumped after its cloud division missed revenue estimates, while post-earnings gains in Microsoft (NASDAQ:MSFT) and Boeing (NYSE:BA) helped lift the Dow.
Google-parent Alphabet slid 8.6% to a three-month low as its cloud business crawled to its slowest growth in at least 11 quarters.
Microsoft, on the other hand, rose 3.8% to a three-month high after topping expectations for first-quarter results in all segments, including its cloud business.
“Investors are worried that Alphabet is losing out to Microsoft and Amazon in a sector deemed to have enormous growth potential due to the future uptake of generative artificial intelligence,” David Morrison, senior market analyst at Trade Nation, said.
However, a rise in long-dated U.S. Treasury yields also weighed on other mega-cap stocks. Meta Platforms (NASDAQ:META), due to report after the closing bell, fell 3.0%, while Apple (NASDAQ:AAPL) and Amazon.com (NASDAQ:AMZN) dipped 1.2% and 3.2%, respectively.
Eight of the 11 major S&P 500 sectors were trading lower, with communications services touching a near one-month low, while consumer discretionary and real estate were among top laggards.
Even after cutting its 737 delivery forecast for this year, Boeing advanced 1.9% on sticking to its goal of generating $3 billion to $5 billion in free cash flow and beating third-quarter revenue estimates.
Defense contractor General Dynamics (NYSE:GD) rose 3.5% after reporting a jump in third-quarter revenue.
Of the 118 S&P 500 companies that have reported so far, 81% have beaten analysts’ earnings expectations, LSEG data showed on Tuesday. Quarterly earnings are expected to grow 1.7% year-on-year.
Meanwhile, Israel intensified its overnight bombing of southern Gaza, where officials said record numbers of Palestinians had been killed again, as violence flared elsewhere in the region and a showdown loomed at the U.N. on Wednesday over desperately needed aid.
At 9:35 a.m. ET, the Dow Jones Industrial Average was up 85.11 points, or 0.26%, at 33,226.49, the S&P 500 was down 26.72 points, or 0.63%, at 4,220.96, and the Nasdaq Composite was down 162.46 points, or 1.24%, at 12,977.42.
Third-quarter gross domestic product, durable goods and personal consumption expenditure data scheduled for the rest of the week will also be in focus.
U.S. Federal Reserve officials were under a media blackout ahead of their decision on interest rates on Nov. 1.
Among other stocks, Texas Instruments (NASDAQ:TXN) shed 2.7% after the analog chipmaker forecast fourth-quarter revenue and profit below estimates.
CoStar Group (NASDAQ:CSGP) dropped 6.1% after the real estate information provider trimmed its annual revenue outlook.
Casino operators MGM Resorts (NYSE:MGM) and Caesars (NASDAQ:CZR) Entertainment fell 2.2% and 3.4%, respectively, after the Detroit City Council passed a resolution supporting striking casino workers.
Declining issues outnumbered advancers for a 2.99-to-1 ratio on the NYSE and a 2.41-to-1 ratio on the Nasdaq.
The S&P index recorded no new 52-week high and 32 new lows, while the Nasdaq recorded 11 new highs and 144 new lows.
