Wall St loses over $200bn in value

The US stock market suffered a huge loss of over $200 billion in value in extended trade on Thursday following a weak forecast from Amazon. The company had forecast a slowdown in sales growth for the holiday season, the latest in a string of downbeat quarterly reports from Big Tech companies.

Amazon announced that its net sales were $127.1 billion in the third quarter ending September 30, little lower than analysts' expectations of $127.46 billion, according to IBES data from Refinitiv.

For the holiday quarter, the world's biggest online retailer forecast net sales of between $140 billion and $148 billion, which were earlier expected to be around $155.15 billion.

Amazon's stock tumbled 17 per cent after the bell and wiped out $190 billion in market capitalization. 

Even though Apple reported revenue and profit above Wall Street targets, its iPhone sales fell short of expectation. Its shares fell about one per cent, erasing about $30 billion of its stock market value. Phone sales for the company's fiscal fourth quarter rose to $42.6 billion,  falling short of the estimated figure of $43.21 billion, according to Refinitiv IBES.

The poor quarterly results from some of Wall Street's biggest companies gives rise to worries about the health of the global economy as central banks raise interest rates in a battle against inflation.

"Big Tech companies are not impervious to slowdowns in the economy, particularly if they are consumer driven," Rick Meckler, a partner at Cherry Lane Investments in New Vernon, New Jersey, told Reuters.

"As the Fed embarks on this planned slowdown, it is eating away at some of their consumer-faced businesses, and given their high multiples it is causing big contractions in their stock prices," Meckler said.

Nasdaq futures tumbled about three per cent, sending signals that Wall Street might open with a deep decline on Friday. Google-owner Alphabet and Microsoft dropped about 1 per cent each, adding to losses following their poor quarterly reports on Tuesday.

Meta Platforms Inc shares also sank 25 per cent following the company's costly metaverse bets and the impact of soaring inflation on ad spending spooked investors. Meta's stock market value was at about $260 billion. It is now about the 20th most valuable company on Wall Street.

If Amazon's drop after hours is reflected in Friday's trading session, it will have been its deepest one-day loss since 2006.

Meanwhile, Pinterest surged 12 per cent after the social media platform reported higher than expected quarterly revenue, while Intel climbed six per cent.