Big Tech Struggles Despite Solid Earnings

Days out from the presidential election, as virus cases rise, the stock market is reacting with heightened uncertainty.

Investors are concerned about the prospect for a contested election, says Mark Hackett, chief of investment research at Nationwide in Downingtown, Pennsylvania. “Conventional wisdom says that gridlock is good for markets, as lack of actions is generally welcome, though there is evidence that investors are growing weary of gridlock, particularly to the extent that it complicates stimulus,” he says.

All major indices finished off the week in the red. The Dow Jones Industrial Average finished Friday down 157 points, or 0.6%, to close at 26,501.

Beating estimates isn’t good enough: Apple (ticker: AAPL) beat expectations, bringing in record quarterly revenue of $64.7 billion for the fiscal fourth quarter. Despite that, Apple stock closed Friday down 5.6%.

Amazon ( AMZN) net sales increased 37% to $96.1 billion compared to 2019’s third quarter, showing just how much of a positive impact the pandemic has had on Amazon’s e-commerce growth. Nonetheless, AMZN closed the day down more than 5%.

Alphabet ( GOOGL) recorded $46.2 billion in revenue, driven by better-than-expected growth in advertiser spending, and shares actually rounded out the day up 3.8%. Another Big Tech company, Facebook ( FB), also enjoyed better-than-expected revenue growth and a solid 12% year-over-year increase in users. But FB, which didn’t offer concrete financial guidance, saw its stock fall more than 6%.

[Read: Should You Buy Apple (AAPL) Stock?]

Oil giant to cut spending: Exxon ( XOM) reported third-quarter revenue of $46.2 billion compared to last year’s $65 billion. XOM lost $680 million on that revenue in the third quarter. The company is set to reduce its capital expenditures in 2021. Oil production increased by 3.7% in its latest quarter, a 1% increase from last quarter.

Income increase means more spending: The Bureau of Economic Analysis released personal income expenditures for September 2020 today. According to the report, personal income increased $170.3 billion, an increase of 0.9% in September. Disposable income also increased by 0.9% to $150.3 billion, accompanied by a 1.4% increase in personal consumption expenditures of $201.4 billion.

[READ: Should You Buy Amazon (AMZN) Stock?]

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Big Tech Struggles Despite Solid Earnings originally appeared on usnews.com

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