Stocks declined on Wednesday after Microsoft and Google’s parent company Alphabet released mixed earnings results. The S&P 500 slipped by 0.6% and the tech-heavy Nasdaq Composite declined by over 1%. The Dow Jones Industrial Average, in contrast, gained 0.2%. Following the latest corporate earnings, the 10-year Treasury Yield rose to 4.88% while the 30-year note simmered above 5%.
Alphabet shares declined by over 8% after it beat revenue and earnings targets yet fell short with its cloud business. Still, Alphabet CEO Sundar Pichai revealed that his company is seeing “a lot of interest in AI”, attempting to inject hope into what appeared to be a disappointing third quarter.
Microsoft stocks gained 4% after it was shown that its AI business was taking off, while its cloud business grew by 3%. “Some of the improvements, we’re making in Azure and even in Microsoft 365 gross margins, even in the core of the commercial cloud, it speaks to the pace at which we are delivering AI revenue with the increasing cost expense and capital investment ahead with the demand we see,” Microsoft CFO Amy Hood observed.