Stocks Slide as Tech Earnings Disappoint Investors

In a mixed report, major indices closed lower Wednesday, with notable declines in technology stocks following Nvidia's earnings report despite strong growth. Companies like Super Micro Computer and Foot Locker cut forecasts, raising investor concerns about market outlook.

Date: 11-09-2024

AI Rating: 5

The report illustrates a downward trend in the stock market, particularly impacting major indices like the S&P 500, Dow Jones, and Nasdaq 100, which closed down by -0.60%, -0.39%, and -1.18%, respectively. The weakness in the stock market is notably driven by the technology sector, particularly in chip stocks ahead of Nvidia's earnings.

Even though Nvidia reported revenue growth of 122% year-over-year and net income more than doubled, the stock still fell 7% after hours due to investor concerns about valuation and future prospects. This highlights the challenges of market sentiment despite impressive revenue support.

On the negative side, several companies reported disappointing results or forecast cuts:

Super Micro Computer saw its stock drop more than -19% after delaying its filing for the Annual Report.
Foot Locker fell more than -10% after reducing its gross margin forecast for 2025.
J M Smucker reported a drop of over -4% after slashing its full-year net sales forecast.
Bath & Body Works missed consensus on net sales leading to a drop of -7%.
nCino Inc and PVH Corp also forecasted results below expectations, reflecting broader troubles across sectors.

Positives in the report include Box Inc, which closed up more than +10% thanks to a better-than-expected EPS report and raised forecasts. Similarly, Nordstrom rose over +4% after reporting stronger-than-expected sales and adjusting its forecast positively. This shows that not all companies are struggling, but the market reaction is more sensitive to misses than beats in forecasts.

Overall, the report indicates a cautious investor sentiment primarily affected by technology earnings and company-specific challenges. The declines in major tech stocks can set a negative tone for market sentiment going forward.

Stocks: NVDA SMCI FL SJM BBWI NCNO PVH LULU BOX JWN