Early trading on Wall Street saw losses as the tech sector was impacted by lackluster earnings from prominent companies.
Before the bell, futures for the S&P 500 dropped 0.9% and futures for the Dow Jones Industrial Average fell 0.5%. The Nasdaq, which is tech-heavy, tumbled 1.3%.
Tesla reported a 45% decline in second-quarter net income compared to the previous year, with a decrease in global electric vehicle sales despite price adjustments and low-interest financing. Tesla’s shares were down 8.5% in premarket trading on Wednesday.
Alphabet Inc., Google’s parent company, showed consistent growth in another quarter driven by AI in the search engine. However, YouTube ad revenue fell short of expectations, causing shares to decline by 3.5% before the bell.
Earnings season is underway with projections for strong profit growth for S&P 500 companies. Despite these forecasts, investors have not seemed impressed thus far.
LVMH shares dropped 4% after the luxury giant reported quarterly sales below market expectations.
Microsoft company will release its latest results after market close on Wednesday.
Later in the week, investors will be balancing numerous earnings reports and important economic data.
The government will release its first estimate of U.S. GDP for the second quarter on Thursday. On Friday, attention will turn to the latest inflation data in the consumer spending report. Expectations are for the Federal Reserve to start reducing its main interest rate in September as inflation eases.
In Asia, Japan’s Nikkei 225 declined by 1.1% to 39,154.85, with the yen strengthening ahead of the Bank of Japan policy decision next week.
Elsewhere, the Hang Seng in Hong Kong lost 0.9% and the Shanghai Composite dropped 0.5%. Australia’s S&P/ASX 200 slipped 0.1% while South Korea’s Kospi fell 0.6%.
In the commodities market, U.S. benchmark crude oil gained 98 cents to $77.94 per barrel, while Brent crude rose 84 cents to $81.85 per barrel.
The euro remained steady at $1.0851.
In Tuesday’s trading, the S&P 500 and Dow Jones Industrial Average dipped slightly, while the Russell 2000 saw gains amid hopes for potential interest rate cuts in the future.
