Tech earnings misses give Wall Street its worst day since June

Investors absorbed broad losses as technology shares led Wall Street lower, leaving the S&P 500 to close a third straight losing week and only 3.1 percent below its all-time high.

The retreat followed earnings reports that fell short of analysts’ expectations, including Intel’s profit forecast for the final three months of the year and Amazon’s weaker summer profit.

Joe Tigay, a portfolio manager at Equity Armor Investments, described the market as moving out of the hopes and dreams phase of the artificial-intelligence trade and into the show me phase.

Technology and financial markets across North America fell sharply as the earnings reports arrived. Intel’s forecast came first, and its stock then plunged 28.6 percent, its worst drop since 1974.

Amazon sank 1.4 percent after reporting weaker summer profit than analysts expected. The company had burned through $42.4 billion US of cash over the prior 12 months, measured by free cash flow, while spending $94.8 billion US on property and equipment, primarily on artificial-intelligence technology.

Alphabet’s stock had fallen more than 12 percent to its worst day on record a day earlier. Nvidia dropped 4.2 percent.

The Nasdaq composite dropped 2.9 percent. The S&P 500 tumbled about 1.8 percent Friday, its worst day since June, while the Dow Jones Industrial Average fell 1.1 percent. Canada’s S&P/TSX composite closed down 1.7 percent.

Other markets also fell. Bitcoin slipped towards $77,000 US, from more than $86,000 US earlier this month, and Coinbase Global lost 10.6 percent.

Energy and consumer staples companies offered a different earnings signal. ExxonMobil climbed 2.2 percent and Chevron added 1.8 percent after both reported stronger summer profit than analysts expected. Mondelez International rose 3.9 percent due to better than expected growth, while Colgate-Palmolive climbed 2.3 percent after higher product prices helped it report revenue and profit above analysts’ expectations.

Treasury yields also fell. The yield on the 10-year Treasury declined to 4.93 percent from 4.98 percent late Thursday and from more than 5.30 percent earlier this month.