Live Markets: Alphabet drags Nasdaq as healthcare, housing, banks shine

Microsoft

Yesterday 14:31

Main US equity indexes decline; Nasdaq down >1%
Communication services is weakest S&P 500 sector; Healthcare is the leading gainer
Euro STOXX 600 index up ~0.9%; ECB leaves rates unchanged
Dollar ~flat; gold, US crude, bitcoin all down >1%
US 10-year Treasury yield falls to ~4.99%
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ALPHABET DRAGS NASDAQ AS HEALTHCARE, HOUSING, BANKS SHINE
The main US indexes are lower early Thursday, with the tech-heavy Nasdaq .IXIC under the most pressure after Alphabet's results revived concerns about the rising cost of AI investment. Investors are also digesting fresh inflation and growth data a day after the Federal Reserve left interest rates unchanged.
Alphabet GOOGL.O shares are tumbling 12%, putting the company on track to shed more than $450 billion in market value if losses hold. The stock is under pressure after disappointing search advertising results and signs of accelerating cash burn tied to AI spending.
On the economic front, Thursday's data largely met expectations. The Personal Consumption Expenditures Price Index, the Fed's preferred inflation measure, rose in line with economists' forecasts, while a separate report showed the US economy is expanding faster than expected in the third quarter.
The weakness in the major indexes masks considerable divergence beneath the surface. Most S&P 500 .SPX sectors are trading higher, led by healthcare .SPXHC, which is up more than 2%. Communication services .SPLRCL, however, is sliding more than 6%, weighed down by Alphabet's decline.
With the 10-year Treasury yield US10YT=RR back below 5.00%, interest-rate-sensitive groups are finding support. Housing-related shares .HGX and big banks .SPXBK are among the stronger areas of the market. Software and services .SPLRCIS, and gold and silver miners .XAU are especially weak.
Meanwhile, the S&P 500 healthcare sector, the S&P 500 Value Index .IVX, and Apple AAPL.O are all on track for record closing highs.
Here is a snapshot of where markets stood around 10:25 a.m. ET.
(Terence Gabriel)
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EARLIER ON LIVE MARKETS:
AI SPENDING CONCERNS OVERSHADOW STEADY ECONOMIC DATA CLICK HERE
LOOMING TECH THREAT CLICK HERE
AU REVOIR, MME LAGARDE CLICK HERE
EARNINGS DRIVE MIXED INDEX PERFORMANCE CLICK HERE
EUROPE BEFORE THE BELL: NO TIME FOR A BREATHER CLICK HERE
IN THE AI ALPHABET, CASH IS KING CLICK HERE
     

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(Terence Gabriel is a Reuters market analyst. The views expressed are his own )