Megacaps Drop ahead of Next Week’s Earnings – US Market Wrap

A selloff in the world’s largest technology companies impacted stocks, as the industry that has propelled the bull market prepares to report earnings next week.

Equities continued to fall from a record high, with the S&P 500 falling below 5,000 and the Nasdaq 100 falling more than 2%. More than half of the “Magnificent Seven” cohort of tech megacaps will report results in the coming days, leaving investors wondering if those companies will meet the high expectations set for artificial intelligence. Nvidia and Super Micro Computer both lost at least 10%.

Profits for the S&P 500’s seven largest growth companies – Apple, Microsoft, Alphabet, Amazon, Nvidia, Meta Platforms, and Tesla – are expected to rise 38% in the first quarter. Without them, the rest of the index’s profits are expected to fall by 3.9%.

The S&P 500 fell for the sixth time in a row, marking the longest losing streak since October 2022. The drop in Nvidia wiped out more than $200 billion in value, with the Nasdaq 100 falling the most this year. Netflix fell after management decided to stop reporting quarterly subscriber data, dimming the company’s otherwise stellar financial results.

Treasury 10-year yields fell one basis point to 4.62%, nearly erasing a 14-basis-point drop. Oil reversed a major advance to trade marginally higher after Iranian media appeared to downplay the impact of Israeli strikes.

Have a good weekend!