By Abigail Summerville
(Reuters) -U.S. stock indexes closed lower on Wednesday as chip stocks tumbled and investors awaited a host of corporate earnings.
Microsoft (NASDAQ:) and Meta Platforms (NASDAQ:) reported earnings after the bell, with both beating quarterly revenue estimates.
Shares of Alphabet (NASDAQ:), the first of the five “Magnificent Seven” megacap stocks that reported results this week, rose 2.8% after the company on Tuesday beat expectations for third-quarter revenue and profit.
Alphabet helped to offset falling chip stocks, weighed by dour forecasts from Advanced Micro Devices (NASDAQ:) and Qorvo (NASDAQ:), which fell 10.6% and 27.3%, respectively.
Meanwhile, shares of Super Micro Computer (NASDAQ:) plunged 32.6% after Ernst & Young resigned as the company’s accountant. Nvidia (NASDAQ:) slipped 1.4%.
The information technology sector was the biggest sectoral decliner, falling 1.34%, while Alphabet’s gains lifted the communication services sector.
“Qorvo, Advanced Micro and Super Micro – those are three pretty big moves that are causing a little bit of angst and taking some of the bloom off the rose from the stellar print from Google last night,” said Michael James, managing director of equity trading at Wedbush Securities.
“The clear laser focus is going to be on the stock specific reports and guides,” James said.
The fell 91.51 points, or 0.22%, to 42,141.54, the lost 19.25 points, or 0.33%, to 5,813.67 and the lost 104.82 points, or 0.56%, to 18,607.93.
In economic data, the U.S. gross domestic product increased at a 2.8% annualized rate, according to the Commerce Department’s advance estimate of third-quarter GDP, slightly below economists’ forecast of 3.0% growth.
A separate report showed U.S. private payrolls growth surged by a higher-than-expected 233,000 jobs in October.
The neck-and-neck race between U.S. presidential candidates Kamala Harris and Donald Trump was also at the top of investors’ minds ahead of the Nov. 5 election.
Eli Lilly (NYSE:) fell 6.2% after missing sales estimates for its popular weight-loss and diabetes drugs.
Starbucks (NASDAQ:) reported earnings after the close showing a drop in quarterly sales as global demand suffers.
Advancing issues outnumbered decliners by a 1.01-to-1 ratio on the NYSE. There were 210 new highs and 52 new lows on the NYSE.
The S&P 500 posted 24 new 52-week highs and five new lows, while the Nasdaq Composite recorded 126 new highs and 98 new lows.
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