Under the weight of several uncertainties, Wall Street ended October in the red on Friday, marking its worst week as well as worst month since March and that too just four days before the U.S. presidential election that will pit Donald Trump against Joe Biden on Tuesday. Investors are also worried about the alarming health situation associated with Covid-19, especially as political uncertainties have delayed the adoption of a new fiscal support plan for the US economy.
On Friday, with the exception of Alphabet (up 3.8 percent), GAFA shares weighed on the stock market after the announcement of better-than – expected results, but concerns for potential earnings mounted. Despite good results, stocks of the highly regarded ‘technos’, weakened.
The large S&P 500 index gave up 1.21 percent to 3,269 points, the Dow Jones index lost 0.59 percent to 26,501 points at the close, while the Nasdaq Composite, rich in technology and biotech stocks, fell 2.45 percent to 10,911 points.
The indices including DJIA, S&P 500 and Nasdaq lost 6.5, 5.6 and 5.5 respectively lost over the past week which was their worst weekly results since March. October also ended with indices losing 4.6 percent, 2.8 percent and 2.3 percent respectively, facing the worst monthly results since March.
In the corporate news, after the release on Thursday night after the closing, the quarterly results of the largest GAFA technology firms namely Alphabet (Google’s parent company), Apple, Facebook, and Amazon, as well as the Twitter social network drank the cup except Alphabet. Stock of Apple lost -5.6 percent, Facebook dropped by -6.3 percent and Amazon shunned -5.4 percent, while the Twitter faced decline of -21.1 percent in its stock value on Friday.
Despite better-than-expected figures, markets are afraid of weakening in profit outlook in the coming months, and are taking profits in a highly valued business seriously. In particular, Apple was frustrated by a 20% drop in its iPhone sales over one year in the third quarter and by the lack of projections for the current quarter, the holiday season, which is still crucial for its business.