Wall Street drops at open as tech stocks slide

US stocks fell on Friday, dragged down by a slide in shares of tech heavyweights following their quarterly results, with a record rise in coronavirus cases and nerves over the presidential election adding to a downbeat mood.

Apple Inc tumbled about 6% after it posted the steepest drop in quarterly iPhone sales in two years due to the late launch of new 5G phones.

Amazon.com Inc fell 4% after it forecast a jump in costs related to COVID-19, while Facebook Inc shed 3.5% as it warned of a tougher 2021.

Tech and consumer discretionary sectors posted the steepest percentage declines.

Communication services got a boost from a 5.7% jump in shares of Alphabet Inc after the Google parent beat estimates for quarterly sales as businesses resumed advertising.

“The market reaction today is more of where (the tech results) came in vs certain people’s expectations. Take a step back and look at the growth that these companies delivered, it’s pretty impressive,” said Pete Santoro, a Boston-based equity portfolio manager at Columbia Threadneedle.

“We’re two market days away from Election Day and people want to make sure that they’re not completely caught off guard.”

President Donald Trump has consistently trailed Democratic challenger Biden in national polls for months, but polls in the most competitive states have shown a closer race.

Wall Street‘s fear gauge held at a 20-week high ahead of the final weekend before Election Day on Tuesday.

At 09:50 a.m. ET, the Dow Jones Industrial Average fell 229.87 points, or 0.86%, to 26,429.24 and the S&P 500 lost 32.67 points, or 0.99%, to 3,277.35. The Nasdaq Composite lost 187.12 points, or 1.67%, to 10,998.48.

The S&P 500 and Dow were on course for their worst week since March as spiraling coronavirus cases in the United States push hospitals to the brink of capacity.

Third-quarter earnings season is past its halfway mark, with about 84.8% of S&P 500 companies topping earnings estimates, according to Refinitiv data. Overall, profit is expected to tumble 13.4% from a year earlier.

Twitter Inc slumped 18% after the micro-blogging site reported fewer users than expected and warned the U.S. election could impact ad revenue.

Under Armour Inc rose 6% as it forecast full-year revenue above analysts’ estimates, boosted by a surge in online demand for running shoes and other fitness gear.

AbbVie Inc gained 5% after the drugmaker posted better-than-expected quarterly earnings and raised its full-year adjusted profit forecast.

Declining issues outnumbered advancing ones on the NYSE by a 2.1-to-1 ratio; on Nasdaq, a 0.4-to-1 ratio favored advancers.

The S&P 500 posted two new 52-week highs and one new low; the Nasdaq Composite recorded six new highs and 30 new lows. – Oct 30, 2020

Subscribe and get top news delivered to your Inbox everyday for FREE