The S&P 500 and Nasdaq Composite ended a fickle session weaker on Thursday, failing to regain ground lost in the previous day's tech-triggered sell-off as investors grappled with the likely direction of megacaps.
Market Snapshot
The S&P 500 lost 27.91 points, or 0.51%, at 5,399.22 points, while the Nasdaq Composite fell 160.69 points, or 0.93%, to 17,181.72. The Dow Jones Industrial Average rose 81.20 points, or 0.20%, to 39,935.07.
Market Movers
Ford closed down 18% after second-quarter adjusted earnings of 47 cents a share missed analysts’ estimates by a wide margin and the auto maker left unchanged its profit outlook for the year. It was the stock’s worst drop since Nov. 18, 2008, when shares dropped 25%.
Ford’s operating profit in the second quarter was $2.8 billion, down 26% from a year earlier. The company’s electric-vehicle business lost $1.1 billion in the period, narrower than a year-earlier loss of $1.3 billion.
Tesla Motors closed up 2% after shares of the electric vehicle maker closed down 12% on Wednesday, the stock’s largest percentage decrease since Sept. 8, 2020, when TSLA dropped 21%, according to Dow Jones Market Data. The reason for the steep decline was Tesla’s second-quarter earnings, which missed analysts’ expectations when they were released late Tuesday. KGI Securities downgraded shares to Hold from Buy.
Alphabet closed down 3.1%. The parent of Google and YouTube sank 5% on Wednesday after Alphabet topped second-quarter profit and sales expectations, but ad revenue from YouTube disappointed.
Shares of chip maker NVIDIA Corp closed down 1.7% after the stock dropped 6.8% on Wednesday, falling along with other artificial-intelligence names. Server maker SUPER MICRO COMPUTER INC fell 2.2% after slumping 9.2% on Wednesday.
Shares of IBM were up 4.3% after the company posted second-quarter adjusted earnings of $2.43 a share, higher than analysts’ estimates of $2.18. Revenue of $15.8 billion beat expectations of $15.62 billion. CEO Arvind Krishna said IBM was seeing rising customer demand for new artificial-intelligence projects. The CEO added that IBM’s “book of business for generative AI has grown to more than $2 billion since the launch of Watsonx one year ago.”
Cloud-software company ServiceNow jumped 13% after reporting second-quarter revenue of $2.63 billion, up 22% from a year earlier and higher than Wall Street estimates. Subscription revenue in the period rose 23%. ServiceNow also boosted its fiscal-year outlook for subscription revenue. Meanwhile, ServiceNow Chief Operating Officer CJ Desai resigned following an internal investigation that found company policy was violated in the hiring of Raj Iyer, the company’s head of public sector thought leadership and business development.
Viking Therapeutics surged 28% after the company said it would advance an injectable version of its experimental obesity drug directly to Phase 3 trials.
Southwest Airlines closed up 5.5% after the carrier posted better-than-expected second-quarter earnings and announced plans to introduce assigned and premium seating, a change from its traditional open-seating policy.
American Airlines rose 4.2% even after issuing a profit warning for the third quarter. The airline said it expects to break even in the third quarter, while analysts had been expecting third-quarter earnings of 48 cents a share. American reported a second-quarter profit and load factor that topped expectations.
Edwards Lifesciences closed down 31% after second-quarter revenue of $1.63 billion missed expectations of $1.66 billion. The medical-technologies company also reduced full-year sales guidance for its transcatheter aortic valve replacements.
RTX Corp was up 8.2% after it reported better-than-expected second-quarter earnings and raised its financial forecasts for the year.
AbbVie was up 3.4%. The company reported a strong second quarter and raised its guidance. Sales for its immunology drugs other than Humira jumped sharply.
Market News
Alphabet’s Stock Falls as OpenAI Teases ChatGPT Search Prototype
Shares of Alphabet Inc. are falling Thursday on concerns that the search market is about to get new competition.
OpenAI, the creator of ChatGPT, said it was launching “a temporary prototype of new [artificial-intelligence] search features.” It will be available to a small group of users and publishers, who will offer feedback.
“We believe that by enhancing the conversational capabilities of our models with real-time information from the web, finding what you’re looking for can be faster and easier,” OpenAI said in a release.
CrowdStrike Says over 97% of Windows Sensors Back Online
More than 97% of Windows sensors are back online, CrowdStrike's CEO George Kurtz said on Thursday, nearly a week after a software update by the cybersecurity firm triggered a global outage.
The company's Falcon platform sensor is a security agent installed on devices such as laptops and desktops that protects them from threats.
Dexcom Shares Plunge After It Cuts Annual Revenue Forecast
Medical device maker Dexcom cut its annual revenue forecast on Thursday, blaming a restructuring of its sales team, fewer customers, and lower revenue from each customer, sending its shares plummeting 40% in extended trading.
The company expects 2024 revenue of about $4 billion to $4.05 billion, compared with its previous forecast of $4.20 billion to $4.35 billion. Analysts on an average were expecting $4.33 billion, according to LSEG data.
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