 "Nasdaq sees its worst week since February")
Disappointing earnings reports erased $68 billion from shares of Netflix, Microsoft and Alphabet and sent the Nasdaq 100 Index to its biggest weekly drop since February.
Netflix saw its stock fall the most among the trio after rattling investors with forecasts for weakening subscriber growth overseas. The Los Gatos, California-based online video provider slid 14 per cent, the largest drop since September. Concerns about a turnaround plan sent Microsoft down 7 per cent while Google's parent declined 5.4 per cent on margin concerns.
The three stocks accounted for 80 per cent of a 1.5 per cent retreat in the Nasdaq 100, the biggest decrease since it lost 6 percent in the week ending February 5.
While earnings at S&P 500 companies are exceeding analyst estimates by 4 per cent on average, the spotty results from mega-cap tech stocks are taking a toll on the broader market. The S&P 500 couldn't hold 2,100 this week - a level it's crossed 40 times since the start of 2015 and a key threshold where JPMorgan Chase & Co says more buyers could step in.
The S&P 500 couldn't hold 2,100 in November, either, a concern for bulls worried history will repeat. Back then, it jumped 13 per cent from a summer low to peak at 2,109.79 in the span of 10 weeks.
Lagging tech stocks are one of the few traits that distinguishes the current rally from the rebound last fall. The Nasdaq has added 13 per cent since February 11, trailing the S&P 500's advance.
Signs of trouble started on Monday when Netflix said it expects to add 2 million new international customers, short of the 3.45 million average of analysts' estimates compiled by Bloomberg.
Then came announcements from Microsoft and Alphabet, whose shares lost at least 5.4 per cent on Friday. Microsoft stock dipped the most since January 2015, reversing a march toward a historic high, after the software maker reported earnings that fell short of analysts' estimates. Disappointing profits were also to blame for Alphabet's decline, as the company's chief financial officer said profit margins could be under pressure by higher mobile phone use and growth in automated ads.
