by Stephen Culp

NEW YORK (Reuters) – The New York Stock Exchange ended lower on Thursday, for a second consecutive session, after the publication of contrasting quarterly results and economic data which showed the resilience of the American economy, fueling fears that the Federal Reserve (Fed) maintains high interest rates over a long period of time.

The Dow Jones index fell 0.76%, or 251.63 points, to 32,784.30 points.

The broader S&P-500 lost 49.54 points, or 1.18%, to 4,137.23 points.

The Nasdaq Composite fell 225.62 points (1.76%) to 12,595.61 points.

The Nasdaq once again recorded the most marked decline, weighed down by high-growth stocks which are particularly sensitive to interest rates and some of which reported gloomy forecasts this week.

Wall Street’s three main indexes are heading towards a decline for the week as a whole.

Meta, which published its quarterly results on Wednesday after the close, notably warned of an acceleration in its expenses. Alphabet disappointed investors with the performance of its “cloud” division. The results from Amazon, another member of the so-called “Magnificent Seven” group – which also includes Apple, Microsoft, Nvidia, Tesla – were expected Thursday evening.

“Today it was all about the ‘magnificent seven’, and no matter what they published in terms of results, I don’t think people would have been satisfied,” commented Scott Ladner , chief investment officer at Horizon Investments in Charlotte.

“So we are seeing profit-taking by investors and a rotation away from anything that has performed this year, in favor of what has not,” he said.

Strong economic data, including 4.9% annualized growth in US gross domestic product (GDP) – a nearly two-year peak – has fueled investor concerns about tightening policy. monetary policy of the Fed.

“This contradicts the idea that the Fed could start cutting rates in 2024,” said Greg Bassuk, managing director at AXS Investments in New York.

“While this data is strong, ironically it exacerbates investors’ concerns” about the US central bank maintaining high interest rates over a longer period of time, he added.

This week marked an acceleration in the earnings season, with nearly a third of S&P-500 companies including technology giants and industrial heavyweights.

Roughly speaking, four out of five companies exceeded Wall Street’s expectations. Analysts now expect overall revenue growth for S&P-500 companies to be 2.6% year-on-year.

Among the major sectors of the S&P-500, communications services fell 2.6%, the largest decline. Conversely, real estate gained 2.2%.

On the value side, Meta Platforms fell 3.7%, saying it feared the impact of the Israeli-Palestinian conflict on its sales during the current quarter.

United Parcel Service fell 5.9% after lowering its annual revenue forecast. IBM jumped 4.9% after better-than-expected quarterly results, thanks to solid demand for its IT solutions.

( Jean Terzian)

Copyright © 2023 Thomson Reuters