NEW YORK: The S&P 500 was muted on Thursday as losses in tech heavyweights Microsoft and Nvidia countered earnings-led gains for Meta and Tesla, while investors parsed a slew of corporate earnings a day after the US central bank held interest rates steady.
Microsoft dropped 6.2% after forecasting disappointing growth in its cloud computing business, while Meta Platforms added 1.8% after beating fourth-quarter revenue estimates.
Commenting on Microsoft’s results, Victoria Fernandez, chief market strategist at Crossmark Global Investments, said that “people were waiting to hear something fantastic, and they just didn’t hear it”.
“They were also waiting to hear if there was going to be any kind of decline in capex spending, and they didn’t really get that either,” Fernandez said.
On Wednesday, the chief executives of both Meta and Microsoft defended their heavy investments in artificial intelligence, just days after Chinese startup DeepSeek unveiled a breakthrough in cheap AI models that rattled Wall Street and triggered a bloodbath in AI-linked stocks.
Meanwhile, Tesla gained 2.1% in choppy trading after saying it was on track to roll out new, cheaper EV models in the first half of 2025. It also said it would start testing a paid autonomous car service in June, overshadowing quarterly results that fell short of expectations.
At 11:28 a.m. ET, the Dow Jones Industrial Average rose 45.95 points, or 0.10%, to 44,756.73, the S&P 500 gained 5.56 points, or 0.10%, to 6,045.14 and the Nasdaq Composite lost 58.13 points, or 0.30%, to 19,573.85.
Ten of the 11 S&P 500 sectors traded higher, with outlier information technology down 1.2% after Nvidia’s 3.8% drop exacerbated losses.
Of the 149 S&P 500 companies that have reported earnings so far, 73.2% posted numbers that exceeded analyst estimates, according to data compiled by LSEG.
United Parcel Service lost 17.5% after forecasting 2025 revenue below expectations, dragging the Dow Jones Transport Average down 1%.
Lam Research rose 8% after the chip-making equipment supplier forecast third-quarter revenue above expectations, while Comcast lost 12.5% after reporting a steep decline in broadband subscribers for the fourth quarter.
The focus will now be on Apple and Intel , which are scheduled to report results after markets close.
The US Federal Reserve kept interest rates unchanged on Wednesday, removing language acknowledging easing inflation from its latest policy meeting statement. Chair Jerome Powell said there would be no rush to cut rates again until inflation and job numbers made it appropriate.
Data showed earlier on Thursday that US economic growth slowed in the fourth quarter, while a jobless claims report for the previous week saw claims falling lower than expected.
The economically sensitive Russell 2000 small-cap index was last up 1.2%.
Among other movers, IBM jumped 12.7% after the company surpassed fourth-quarter profit expectations. ServiceNow lost 13.1% after the software firm forecast annual subscription revenue below Wall Street estimates.
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