Tech stocks took a drubbing on Wednesday after lackluster Alphabet and Tesla earnings stirred up worries that Big Tech's power to fuel gains is fading.

The benchmark S&P 500 (^GSPC) tumbled more than 2% for the first time in more than a year, while the Dow Jones Industrial Average (^DJI) dropped about 1.2%. The tech-heavy Nasdaq Composite (^IXIC) led the losses, falling about 3.6%, for its worst day since October 2022.

Stocks sunk as investors digest mixed quarterly earnings from Google parent Alphabet (GOOGL, GOOG) and Tesla (TSLA), the first of the "Magnificent 7" megacaps to report. EV maker Tesla's stock price slid more than 12%, while Alphabet shares dropped more than 5%.

In aggregate, the Magnificent 7 tech stocks lost more than $750 billion in market cap on Wednesday, the most on record for the group.

Chip stocks also tumbled on Wednesday as Nvidia (NVDA) fell almost 7% while Broadcom (AVGO) and Arm (ARM) each dropped about 8%.

In economic news, on Wednesday fresh data from S&P Global showed the business activity in the US grew at its fastest pace in more than two years. Next up are Thursday's second-quarter GDP print and Friday's key release on June PCE inflation, the report favored by the Federal Reserve.

Source : Yahoo Finance - Jul 25, 2024