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Stocks move lower after Microsoft guidance lets down

Yahoo Finance Live’s Brad Smith breaks down how stocks are moving at the open on Wednesday morning.

Video Transcript

[AUDIO LOGO]

[WALL STREET BELL RINGING]

JULIE HYMAN: Here's the opening bell on Wall Street on this Wednesday when we are feeling a little Microsoft hangover, I think, on technology and in the markets more broadly. That combined with the likes of Texas Instruments and some other earnings disappointments. They're definitely putting pressure on stocks here at the open. And continuing to bring a halt or at least a pause to the rally that we have been seeing in large-cap technology.

BRIAN SOZZI: If Microsoft is warning about slowing growth, I can only imagine what some lesser companies are about ready to report, are those fundamentally challenged companies like a DocuSign. That could be a real big fat whiff of a quarter.

JULIE HYMAN: Yeah, well, we're opening down so we'll see what continues to unfold through the earnings season. Brad, what are you seeing at the Interactive?

BRAD SMITH: As of right now I'm seeing some declines. As you were mentioning, they are opening down here. Let me populate this chart for our viewers at home. And you know what? I'll give you a view of what's taken place over the course of this week thus far.

Net, net, three days, past three of them, you're up by about 3/10 of percent on the Dow. But here today, you're actually lower by about 7/10 of a percent. So we'll keep a close eye on that.

The NASDAQ Composite, flat over the past three days. Just barely to the upside. However, out of the gate here today, down by about 1.7%. Bet your bottom dollar that some of the tech sector, XLK that we'll check in on, is certainly going to be impacting the broader tech space. And that'll be showing up in some of the price action that we're seeing here out of the gate.

S&P 500, that's down by about 1.1%. Flat over the past three days but just barely to the downside there. Let's also check in on those sectors here. As I mentioned, 11 S&P 500 sectors, and leading the way at least to the downside-- yep, I said it a moment ago and that was kind of a guess but also an educated guess, I guess, given what we've been discussing here today. It's down by about 2%, leading the declines. And then the best of the worst, if you will, is health care. That's lower by about 4/10 of a percent. All 11 S&P 500 sectors in negative territory.

And let's just take a quick look at some of the mega-cap tech stocks. Apple also lower by about 1.9%. Amazon down nearly 4% out of the gate this morning. So we'll keep a close eye on those as well. But there, Microsoft, aforementioned and much talked about, lower by about 3.2% right now.

JULIE HYMAN: Yeah, and look how dark red Amazon is there--

BRIAN SOZZI: Oh, very dark.

JULIE HYMAN: --at the top of the screen.

BRIAN SOZZI: That's maroon.

JULIE HYMAN: That is-- I think there was also a price target cut for Amazon here this morning, in addition to the ripple effect from Microsoft. So that might also be why the stock is down.

BRAD SMITH: Yeah, year-to-date still holding on to some gains by about 10%. But of course, if you stretch this out to the past 52 weeks, Amazon lower by about 34% over that basis. But here today, yes, some lake red indeed on the screen. You've also got some lake red on the shares of Airbnb. ADP also lower. They've reported earnings this morning. And then booking also that's down by about 3.2%.

BRIAN SOZZI: Brad, what kind of lake is that, lake red?

JULIE HYMAN: What is lake red?

BRIAN SOZZI: What is that?

BRAD SMITH: Lake red? It was a Crayola color growing up.

BRIAN SOZZI: Oh. [LAUGHS]

JULIE HYMAN: I do wonder about the kind of lake that would be that color red.

BRIAN SOZZI: Yeah, because-- like a horror movie.

JULIE HYMAN: We got to look--

BRAD SMITH: The Red Sea.

JULIE HYMAN: Yeah, we gotta-- we gotta look into this more. We got to do a little research. We got to call people at Crayola and find out what's up with that.