Following their recently released quarterly results, shares of major U.S. stock market companies, such as Alphabet Inc., the parent company of Google, saw a decline on Wednesday, putting pressure on big tech equities.
Alphabet (GOOGL), Apple Inc. (AAPL), Microsoft Corp. (MSFT), Tesla Inc. (TSLA), Nvidia Corp. (NVDA), Meta Platforms Inc. (META), and Amazon.com Inc. (AMZN) are among the seven highly watched Big Tech stocks that are included in the Roundhill Magnificent Seven ETF (MAGS). During afternoon trading, the ETF saw a steep 1.5% decline. Particularly hurting the fund, which was intended to evenly weight those seven megacap stocks, was a sharp decline of more than 7% in Alphabet’s shares, which are traded under the symbol GOOGL.
According to a note sent on Wednesday by Bespoke Investment Group, Alphabet has experienced “one of the more negative reactions to earnings reports this earnings season,” following the release of its most recent quarterly results on Tuesday after the closing bell. “But among all the mega-caps that have reported so far, performance since their results were released hasn’t been good.”
Facebook parent Meta was the only stock trading higher than its level before its report, according to Bespoke, when comparing five so-called Big Tech companies that just released quarterly profits. In contrast, according to statistics cited by the Bespoke before the opening bell on Wednesday morning, shares of Apple, Alphabet, Tesla, and Microsoft were all down.
“The last two months must feel like Charlie Brown trying to kick the football,” Bespoke acknowledged, referring to Alphabet. “For several weeks, the stock made multiple attempts to break above $200, and each time it got there, the rug was pulled out from under it and it finished back below that level by the end of the day.”
The shares of the company “finally got and stayed above $200,” according to Bespoke, last week. “Then the Q4 earnings report hit,” Bespoke said, noting that Alphabet’s shares were “struggling to hang on to their 50-day moving average” instead of breaking through Tuesday’s record high.
According to FactSet data, Alphabet’s shares were trading at about $190.73 early on Wednesday afternoon, barely over its 50-day moving average of about $188.67.
Bespoke claims that although Alphabet’s earnings per share were better than predicted, its revenues were “slightly weaker” than projected since the company’s cloud-services business growth slowed more than planned.
The most recent quarterly earnings from Alphabet come after other Big Tech results that were announced only a week ago.
On January 29, the same day that Microsoft and Tesla released their most recent quarterly results, Meta released its fourth-quarter profits. On January 30, Apple released its financial results.
During Wednesday afternoon trading, Nvidia was the only stock in the Roundhill Magnificent Seven ETF to see significant gains. However, as of Wednesday afternoon, Nvidia’s year-to-date decline was over 8%. Last week, the AI chip maker’s stock fell sharply due to worries about a Chinese firm called DeepSeek.
Even though most sectors enjoyed larger increases on Wednesday afternoon, the S&P 500 index SPX, which is highly weighted toward Big Tech stocks, was up a meager 0.1%. As of the last check, FactSet data showed that the tech-focused Nasdaq Composite COMP was down 0.1% in afternoon trading.
