Alphabet, Inc. (GOOGL) and Microsoft Corp. (MSFT) have just released their earnings report with mixed results. Google’s mother company, Alphabet, registered a slower sales growth yet announced a 20-for-1 stock split with the offering date on July 1, which could help preserve its stock price. On the other hand, Microsoft’s earnings rose with the increasing demand for its cloud services as the primary highlight; however, its revenue growth slowed by 20% in the second quarter of 2022 vs. 22% in its first quarter. The critical business segment, Azure Cloud, grew 46%; however, it fell short of a four consecutive quarterly gain of 50%, registering the slowest quarterly result in two years.

Yesterday April 25, in anticipation of this, the NASDAQ 100 index bounced back, closing at 13,533.22, a 1.36% increase from its previous close.

Despite the much-anticipated positive bounce in price that this news would generate. Today, the market close revealed a different outcome after the trading hours. NASDAQ 100 has fallen to 13,009.71, a 3.87% drop from yesterday’s close of 13,533.22. It is the lowest price this year; in fact, the index made up of the largest technology companies listed on the NASDAQ stock market has not visited this price level since May of 2021.

After the closing bell, Microsoft and Alphabet both dropped more than three and a half percent ahead of their results. Furthermore, after its quarterly earnings report disappointed investors, Alphabet fell another 6.5% in extended trading. 

It is one of the most significant sell-offs in the US Stock Market since the COVID-19 pandemic hit in early 2020. Additionally, Dow fell nearly 2.4%, while the S&P 500 lost 2.8%. The steep sell-off came from the rising fear that a possible recession is underway. In addition, investors continue to worry about the slowing global growth and an aggressive interest rate hike from the Federal Reserve.

Investors are also reserved as the possible rise of tension in the Ukraine-Russia Crisis could further hurt the current negative market sentiment. Today, Russia announced that it is halting gas deliveries to Bulgaria and Poland due to these countries’ reluctance to pay in Russian Rubles. Following this, European gas prices increased by 10%. It could have a negative domino effect on the US Stock Market, including NASDAQ. 

The general market is going down as it lacks a catalyst to push it to the upside. Interest rates are still a significant factor in the index’ lack of established possible trends. The general market can be concluded as indecisive as a major sell-off happened from the beginning of the month until now. The market is still clouded with overwhelming fear.  From an optimistic perspective, since the 1990s, the U.S. market managed to withstand the odds when the Fed began its tightening cycle. Coupled with corporate earnings recovery during the early economic cycles, it more than offset the negative impact of higher funding costs. However, in the short term, the market moves in sync with the market sentiment.