The major averages reversed course in the afternoon following a plethora of earnings including blow out earnings from two tech titans. The Dow Jones Industrial Average fell over 200 points or 0.5%. The S&P 500 was modestly lower while the Nasdaq rose over 30 points after jumping 200 points this morning thanks to Meta and Microsoft.

The day started off to the plus side with a 12% surge in Meta and a 4% jump in Microsoft stocks put investors in the buying mood. Software giant Microsoft said annual revenue from its cloud computing service Azure exceeded $75 billion up over 30% year over year. Microsoft’s market capitalization is now over $4 trillion. Meta issued an upbeat third-quarter sales outlook, surpassing the Street’s estimates saying people are staying longer and longer on Facebook and Instagram thanks to AI capabilities.

Not all tech performed well today. Chipmaker, Arm Holdings is down 13% on better than expected earnings following disappointing guidance. All the chip were eventually dragged lower. Qualcomm fell 7% while Micron dropped 5%.

Healthcare was one of the weakest sectors with UnitedHealth Group down 5% on a downgrade. Bristol fell 5% on better than expected earnings. Merck dropped 4% in the afternoon after President Trump sent a letter to drugmakers to lower prices in the US.  

Bonds were quiet on tame inflation data. The 10-year Treasury yield dipped 3 basis point to 4.34%. The 2-year yield was little changed at 3.93% while the 30-year bond yield dopped 3 basis points to 4.88%.

Oil and gold were lower while bitcoin was modestly higher.

Even with today’s pullback, the month of July was strong. The S&P 500 gained more than 2% while the Nasdaq rose 4%. The Dow Jones was up less than a percent.

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