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NASDAQ futures, as well as futures of other US leading indexes fell after discouraging earnings reports from tech companies.
Following disappointing earnings from Big Tech giants Apple Inc (NASDAQ: AAPL) and Amazon.com Inc (NASDAQ: AMZN), the NASDAQ 100 futures declined late Thursday. Futures of the tech-centric index dipped by 1.5%, with the Dow Jones Industrial Average Futures also sliding 0.4%. In addition, the S&P 500 futures fell back by 0.8%.
NASDAQ Futures Down but Composite Climbs 3.1%
These stock futures retracements strongly contrast the significant gains realized during regular trading. For instance, the Dow Jones Industrial Average gained 614 points, or 1.9%, in regular trading, while the S&P 500 advanced 2.5%. Furthermore, the tech-laden NASDAQ Composite also registered big gains for the same period, climbing as high as 3.1%.
Despite Thursday’s gains, these stocks still have some ground to cover to end the month in the green. Currently, the DJIA is off by 2.2% for the month, while the S&P 500 is further back from the green territory by 5.4%. As for the NASDAQ, the tech-heavy index is currently in an unsavory position, down 9.5%. In addition, it also appears set to conclude what would be its worst month since March 2020.
Apple and Amazon Stocks
The past week has been busy and intense following numerous earnings reports – mainly from tech companies. These reports have also primarily influenced investor sentiments throughout the week.
On Thursday night, investors focused on several leading tech players as they rolled out their earnings reports. The market saw specific figures from a few companies, including multinational tech company and e-commerce giant Amazon, as well as consumer electronics powerhouse Apple.
Amazon’s shares dropped approximately 10% during the extended trading session, representing the company’s first loss since 2015. In addition, these shares slump resulted in a bottom-line loss of around $4 billion for the e-commerce giant. According to Amazon, its revenues grew at a sluggish 7% for the quarter to $116.4 billion as shoppers reverted to brick-and-mortar stores. The latest revenue growth rate represents the slowest for the company in approximately two decades. Furthermore, in addition to rising costs and slowed sales for Amazon, its investment in electric vehicle company Rivian wiped out profits.
Amazon also issued weak revenue guidance for the second quarter, forewarning that there may be more losses ahead. For Q2, the company expects operating income between a $1-billion loss and a $3-billion gain. According to Amazon chief executive officer Andy Jassy:
“The pandemic and subsequent war in Ukraine have brought unusual growth and challenges.”
For its Q2 fiscal year report, Apple’s revenue surged 9% year-over-year and beat out the consensus estimate on several fronts, including revenue. The consumer electronics company raked in $97.28 billion versus the estimated $93.89 billion. Apple has also authorized $90 billion in share buybacks. However, AAPL stock 4% in extended trading after CFO Luca Maestri warned about challenges in the current quarter. Maestri specified that supply constraints could hurt sales by up to $8 billion.