New York stocks open lower after earnings shocks at Amazon and Intel; Nasdaq plunges more than 2%

[Financial News] On the 30th (local time), New York stocks opened lower, led by technology shares, as concerns mounted over weak earnings from major megacap tech companies such as Amazon and Intel and the cost of artificial intelligence (AI) investment.
Just after the opening bell, the Dow Jones Industrial Average began trading near flat compared with the previous session, while the S&P 500 fell in the 1.1% range and the tech-heavy Nasdaq Composite plunged more than 2.2%, dropping to its lowest level in more than two months.

Amazon and Intel, which reported earnings after the market close the previous day, stoked concerns that their expanded large-scale AI investments would drain cash and erode profitability, triggering a broad market sell-off.
Amazon's third-quarter earnings per share (EPS) and revenue came in below market expectations at $1.89 (about 2,525 won) and $201.94 billion (about 269.6909 trillion won), respectively. Its stock came under pressure after its trailing 12-month free cash flow (FCF) turned negative, with a deficit of $42.4 billion (about 56.6252 trillion won), and the company said it would increase capital spending further next year. Intel also posted solid third-quarter results, but its fourth-quarter guidance—revenue of $15 billion to $16 billion (about 20.0325 trillion to 21.3648 trillion won) and adjusted EPS of $0.25 (about 334 won)—fell well short of market expectations, sending its shares plunging roughly 25% to 30% before and around the opening bell.

Weak earnings from market leaders chilled investor sentiment across semiconductor and AI-related stocks. After Google parent Alphabet plunged more than 12% the previous day in the wake of a sharp increase in AI investment costs, selling continued in major tech stocks, including NVIDIA (down about 3%), AMD (down about 9%) and Dell (down about 8%).
Art Hogan, chief market strategist at B. Riley Wealth, said, “The hit from the share-price declines amid disappointment triggered by Alphabet, Amazon and Intel is quite significant,” but added, “Rather than a broad market recalibration, money is moving out of overheated tech stocks and into safer investments.”
The fortunes of different sectors diverged sharply. Social media company Reddit plunged more than 25% after lowering its forecasts for fourth-quarter results and user numbers. Crypto-related stocks, including Coinbase (down 11.58%) and Robinhood (down 8.27%), also fell sharply, compounded by news of a large-scale Binance hack, with losses estimated at about $6.3 billion (about 8.4105 trillion won).
Energy stocks, including ExxonMobil and Chevron, gained on strong earnings supported by instability in the Middle East and rising diesel prices. International crude prices, including West Texas Intermediate (WTI), rose nearly 2% amid heightened tensions in the Middle East. With safe-haven demand also in play, the U.S. 10-year Treasury yield fell about 8 basis points (as bond prices rose).
[email protected] Park Ji-hyun Reporter