Nasdaq, S&P 500 slide as Alphabet and AMD earnings fall short

US stocks pulled back on Wednesday after earnings from Alphabet (GOOG, GOOGL) and AMD (AMD) fell short, with investors on alert for fresh moves in the brewing US-China trade war.

The tech-heavy Nasdaq Composite (^IXIC) slipped 0.6%, while the benchmark S&P 500 (^GSPC) slid roughly 0.2%. The Dow Jones Industrial Average (^DJI) was roughly flat after the major gauges closed with gains on Tuesday.

Alphabet’s stock was under pressure, down almost 8%, after fourth quarter cloud revenue undershot estimates. The miss rattled investors concerned that the Google parent’s hefty spending on AI won’t see the hoped-for payoff any time soon.

AI trade hopes were dealt a second blow by AMD’s earnings. While the chipmaker posted a quarterly revenue beat, a disappointing data-center sales forecast raised worries about a loss of AI momentum. AMD shares tumbled over 9%.

Big Tech names like Alphabet are also getting caught up in the tariff tit-for-tat between the US and China, which Wall Street sees as a risk for tech and chip names alike. Apple (AAPL) shares dropped roughly 2% after a Bloomberg report that Beijing is looking into targeting its app store in an antitrust probe.

President Donald Trump’s tariff plans have markets already jumpy, and his unexpected suggestion late Tuesday that the US could take over the Gaza strip and develop it as a “Riviera of the Middle East” left investors even more bemused about which direction policy will take next.

Disney (DIS) was the earnings highlight Wednesday, posting a beat on streaming strength but taking a hit in its theme park business from hurricanes.

LIVE 13 updates

Alphabet shares fall nearly 8% as cloud disappoints

Alphabet’s (GOOGL,GOOG) stock is down more than 8% after the Google parent reported quarterly results.

Yahoo Finance’s Dan Howley reports:

The company fell short on its important cloud segment revenue. The company also dramatically expanded its capital expenditures for the year ahead, from $57.9 billion to a planned $75 billion.

Alphabet’s update comes as China said it’s launching an antitrust probe into Google, in what’s widely seen as a retaliatory measure by Beijing against President Trump’s 10% tariff on goods made in China.

Alphabet is also contending with the fallout from China-based DeepSeek’s AI models. News of these rocked the tech world last week, amid claims they were cheaper to train and as capable as leading models from Silicon Valley companies.

Read more here.
Nasdaq lags at the open

US stocks pulled back on Wednesday after earnings from Alphabet (GOOG, GOOGL) and AMD (AMD) fell short, with investors on alert for fresh moves in the brewing US-China trade war.

The tech-heavy Nasdaq Composite (^IXIC) slipped 0.6%, while the benchmark S&P 500 (^GSPC) slid roughly 0.2%. The Dow Jones Industrial Average (^DJI) was roughly flat after the major gauges closed with gains on Tuesday.
Disney CFO chat takeaway

I just wrapped a chat with Disney (DIS) CFO Hugh Johnston (airing live this morning on Yahoo Finance) and found these two points of most interest:
Europe stocks tread water

European stocks trod water as uncertainty over the US-China tariff face-off continued to dog markets and while investors absorbed corporate results from Santander (SAN) and elsewhere.

The pan-regional benchmark Stoxx 600 (^STOXX) index swung between small gains and losses.

Meanwhile, Germany’s DAX (^GDAXI) was little changed, while the CAC (^FCHI) in Paris slipped 0.3% into the red. In London, the benchmark (^FTSE) index traded broadly flat.
Disney earnings beat as streaming swings to profit, parks take a hit

Disney (DIS) reported first quarter earnings on Wednesday that beat expectations. The media and entertainment giant reported a profit in its streaming segment, while its parks business faced setbacks in the midst of two back-to-back hurricanes and greater cruise ship investments.

Disney+ subscribers also fell by 700,000 in the quarter as a result of expected user churn amid recent price increases. The company hiked the price of its various subscription plans in mid-October.

Analysts polled by Bloomberg had expected subscribers to decline by 1.41 million. The company had reported a loss of 600,000 Disney+ subscribers in the year-ago period. For the current quarter, the company said it expects another “modest decline” in Disney+ subscribers compared to Q1.

Shares ticked up about 2% in premarket trading following the results.

Revenue of $24.70 billion beat expectations of $24.57 billion in the quarter and represented a 5% increase from the prior-year period.

Adjusted earnings per share of $1.76 came in ahead of the $1.42 analysts polled by Bloomberg had expected. Earnings increased 44% from a year ago.

For the full year 2025, Disney reaffirmed guidance of high-single-digit earnings per share growth compared to fiscal 2024. Estimates are calling for an 8.1% increase year over year.

Read more of Disney’s earnings results here.
Apple slides after report of China probe

Apple (AAPL) looks set to become the latest tech megacap to get embroiled in the tariff tug-of-war, as it drew the glare of China’s antitrust watchdog.

The regulator is laying the groundwork for a potential investigation into Apple’s policies and App store fees, Bloomberg reported. Shares fell over 2.5% before the bell.

Beijing has just revived anti-monopoly probes into Google and chip giant Nvidia (NVDA), and its authorities are exploring a new investigation against Intel (INTC), per the Financial Times.

The rush of competition scrutiny is seen as part and parcel of China’s retaliation to tariffs imposed on its exports by the Trump administration, as it could provide leverage in trade talks.
Good morning. Here’s what’s happening today.

Economic data: MBA mortgage applications (week ending Jan. 31); ADP Private Payrolls (December); S&P Global US services PMI (January final); S&P Global US composite PMI (January final); ISM services index (January final)

Earnings: Disney (DIS), Aflac (AFL), Arm Holdings (ARM), Aurora Cannabis (ACB), Boston Scientific (BSX), Ford (F), Novo Nordisk (NVO), Qualcomm (QCOM), Toyota (TM), Uber (UBER), Viking Therapeutics (VKTX)

Here are some of the biggest stories you may have missed overnight and early this morning:

Alphabet’s slumping cloud sales spook investors

Morgan Stanley lowers Fed rate-cut forecast amid Trump tariffs

AMD shares sink as AI fears eclipse Q4 earnings beat

Trump’s tariffs fail to derail Wall Street’s bullish outlook

USPS suspends inbound parcels from China, Hong Kong

Tech investors are aggressively buying the dip
Goldman returns with another tariff call

Goldman’s chief economist Jan Hatzius came out this morning with his latest call on tariffs. Notably, he expects 10% China tariffs to be just the starting point.

Stay on top of the latest updates on tariff threats and policy here.
AMD shares get short-circuited

Nothing terribly wrong with AMD’s (AMD) quarter.

Good data center sales growth of 69% year over year was the standout.

But the stock is being hit in premarket — likely for two reasons. First, said data center growth missed estimates, and second, the company didn’t provide enough AI guidance for Wall Street.

Here’s what KeyBanc analyst John Vinh called out this morning:
Chipotle gets roasted premarket

Chipotle’s (CMG) stock is getting roasted premarket, down 7%.

The company’s earnings had a few things the Street didn’t like from this high-multiple name. Sales guidance was soft, the quarterly sales result was soft, and margin commentary was mixed. January sales were off to a slow start too.

“We were disappointed in the comparable sales outlook but believe it could prove conservative, given the upcoming initiatives. Regardless, we reduced our 2025 operating profit estimate by less than 1% (margin better than expected), and we believe the current stock price offers an attractive entry point,” Stifel’s Chris O’Cull said in a note this morning.

O’Cull isn’t alone on the Street in defending the stock today.

I’ll have more insight into the story around 9:40 a.m. ET — Chipotle CFO Adam Rymer will be on Yahoo Finance for a video interview.
Toyota Motor raises full-year operating profit forecast

Toyota (TM) raised its full-year operating profit forecast by 9%, signaling confidence in its ability to weather any potential US tariffs.

The world’s top-selling automaker updated its profit projection for the fiscal year ending March 2025 to 4.7 trillion yen ($30.7 billion), up from the previous forecast of 4.3 trillion yen.

In addition, Toyota announced plans to set up a wholly owned subsidiary in Shanghai to develop and produce electric vehicles and batteries for its Lexus brand. Production is expected to begin in 2027. The new unit will focus on creating a new Lexus EV with an initial annual production capacity of around 100,000 units.

Despite posting weaker-than-expected third quarter results and marking its second consecutive quarterly profit decline, Toyota’s confidence in its future performance remains strong.
Gold sets record high as trade war between US and China pushes need for stable assets

Gold (GC=F) has surged to a record high, climbing nearly 1% as the first shots of the US-China trade war increase demand for haven assets.

The price of bullion hit an all-time high, topping $2,854 an ounce on Wednesday. This spike followed President Donald Trump’s move to impose a 10% tariff on Chinese imports.

China’s retaliatory efforts have been less aggressive compared to earlier trade conflicts when tariffs were nearly on par with the US’s. However, concerns remain about the potential impact on the world’s two largest economies. Markets are also closely watching to see if these renewed tariffs could trigger inflationary pressures, which might influence US monetary policy.
Asian stocks drop as investors react to rising trade tensions

Asian stocks were mostly lower Wednesday as markets digested the impact of the trade tensions brewing between China and the US.

The CSI 300 Index (000300.SS) quickly erased its initial gains on the first trading day after the Lunar New Year holiday closure, falling by 0.6%.

Japan’s benchmark Nikkei 225 (^N225) slipped 0.2% in early trading. Australia’s ASX 200 (^AXJO) rose 0.5%, while Hong Kong’s Hang Seng (^HSI) dropped 0.6%. South Korea’s Kospi (^KS11) jumped 1.1%

What started as a relatively calm day quickly became volatile after news broke that the US Postal Service would temporarily halt inbound parcels from China and Hong Kong. This move came just one day after both the US and China imposed tariffs on each other’s exports. Although there are still hopes for a deal to ease tensions, investors are pulling back as uncertainty lingers.

The stock outlook remains unclear, largely dependent on further developments in tariff negotiations and China’s economic recovery. US President Donald Trump stated there is no urgency to speak with Chinese President Xi Jinping.