Stocks on Wall Street ended mostly flat Tuesday ahead of earnings reports from tech titans Microsoft and Alphabet. Tepid earnings from Tesla and 3M weighed on the main indexes.
The electric car maker dropped more than 4% after its quarterly revenue marginally beat estimates. Tesla was the top decliner on the Nasdaq, which fell one-third percent. The Dow and S&P 500 closed nearly flat.
Systematic Ventures CEO Max Wolff said the markets’ reaction to Tesla has implications for other stocks this earnings season:
"Tesla is certainly a beloved name, and if they're getting the second glance, that is a bit of a sideways glance at that, that could be a market signaling that this earnings season is going to be the last free pass.”
3M shares also fell even though the maker of everything from Post-its to face masks crushed analysts’ forecasts on the top and bottom lines. It warned of higher costs due to supply chain disruptions.
After the bell, shares of Alphabet shot up 4%. Quarterly profit at the parent of Google crushed analysts’ estimates, and surging revenue also beat.
But investors took profits on Microsoft even though the software giant’s revenue rose 19% and easily beat Wall Street’s targets. Microsoft benefited from demand for its cloud-based services during the health crisis.
Apple and Facebook report results Wednesday; Amazon on Thursday.