Nasdaq-100 futures dip as Alphabet shares sell off after earnings report: Live updates

U.S. stock futures experienced a decline early Thursday as traders analyzed the latest earnings reports from major technology companies. Nasdaq-100 futures fell by 1.4%, while S&P 500 futures decreased by 0.5%. Conversely, Dow futures saw a slight increase of 0.3%.

In Asian markets, Japan’s Nikkei 225 rose by 0.42%, but the Topix index saw a decrease of 0.38%. The South Korean Kospi index dropped by 2.14%, with the smaller Kosdaq index falling even more sharply by 2.75%. Australia's S&P/ASX 200 index was up by 0.46%. The Hang Seng index in Hong Kong remained unchanged, while the CSI 300 index in mainland China fell by 1.20%.

In after-hours trading, Microsoft shares climbed by 3% following strong performance in its Azure cloud services, which contributed to exceeding earnings expectations for the first quarter of its fiscal year, according to LSEG data. This performance stood in stark contrast to Alphabet, which saw its shares decline by 9% after reporting adjusted earnings per share and revenue that fell short of forecasts in the third quarter. Additionally, Alphabet disclosed a negative free cash flow of $9.07 billion and maintained its full-year capital expenditure forecast between $195 billion and $205 billion.

The earnings results arrive at a time when there is heightened interest in the artificial intelligence sector. Stocks related to AI, including the iShares Semiconductor ETF (SOXX) and the Roundhill Memory ETF (DRAM), have faced challenges for much of October, though they have shown signs of recovery recently.

On Wednesday, semiconductor stocks contributed to a positive performance in the broader market, with the S&P 500 gaining for the third consecutive day as Micron Technology surged nearly 6% and Broadcom rose by more than 2%. The tech-heavy Nasdaq Composite also posted a modest gain, increasing by 0.3%.

Earlier on Wednesday, the Federal Reserve opted to maintain its current interest rates, leaving the benchmark rate in a range of 3.75% to 4%. This decision was largely anticipated following the quarter-percentage-point rate hike in September. Fed officials acknowledged that inflation "remains elevated," but indicated they would await further data before making any additional moves.

Daniel Siluk, head of global short duration and liquidity at Janus Henderson Investors, commented on the Fed's decision, stating, "It can be interpreted as mildly dovish at the margin, but we think it is better viewed as an expression of patience rather than a shift away from a tightening bias. The door remains open to further tightening, but the Committee appears willing to wait for incoming data to validate the need for additional action."

Traders are set to gain more insights into the economic landscape on Thursday, with the release of the Personal Consumption Expenditures (PCE) price index report for September, a key inflation measure favored by the Federal Reserve. Additionally, the first estimate of third-quarter GDP and weekly jobless claims data will be published.

On the earnings front, market participants are closely watching for quarterly results from Caterpillar and Eli Lilly in the morning, followed by reports from Amazon and Intel after the market closes.