U.S. stocks ended mixed Tuesday, with tech names getting hammered, while the Dow Jones Industrial Average rebounded to finish in positive territory.
The S&P 500 index finished off 0.8% at 3,941.48. The Dow Industrials rose 0.15% to end at 31,928.62. The Nasdaq composite was slammed after dismal results from Snap (SNAP) spread gloom to big tech names with heavy advertising exposure. The Nasdaq lost 2.4% to end at 11,264.45.
A weaker-than-expected reading for April new home sales, which fell 16.6% to a seasonally adjusted rate of 591,000, added to the somer mood.
Updated at 10:58 am EDT
JPMorgan, which cut its China growth forecast to suggest a contraction of as much as 5.4% for the world's second largest economy, sees global growth advancing at its slowest pace in two years this quarter and, with just a 0.6% forecast, the second-slowest since the global financial crisis of 2008.
Drilling deeper, social media group Snap rattled tech sentiment with a surprise warning on profits and sales as global companies pull back on ad spending in the group's popular messaging app.
Snap, which relies on ad spending for the vast majority of its revenues, said that the "macroeconomic environment has deteriorated further and faster than anticipated", causing companies to pull back on ad spending as they reevaluate priorities in a weakening economy.
Still, economic activity data from Europe over the month of May was reasonably solid, with the S&P Global PMI index slipping to 54.9 points amid record inflation in the single currency area, but still holding well above the 50 point mark that separates growth from contraction.
Citing a memo from CEO Evan Spiegel, Reuters reported that Snap, which makes the Snapchat messaging app, told employees to expect cost cuts and a hiring freeze, while a late Monday Securities and Exchange Commission filing noted the group is likely to report "revenue and adjusted EBITDA below the low end of our Q2 2022 guidance range".
Snap shares were 32% lower, while Meta Platforms (FB), the parent of Facebook, was marked 9.5% lower at $182.99 each while Google parent Alphabet (GOOGL) slumped 7%.
China's Covid lockdown, however, a warning on supply chain disruptions from Toyota, the world's biggest carmaker, on chip supplies that will slash its monthly production rate by 100,000 units and the lingering impact on sentiment -- and demand -- from Russia's war on Ukraine are once again combining to tip stocks into the red, with Europe's Stoxx 600 down 0.48% in mid-day Frankfurt trading and Asia's MSCI ex-Japan benchmark falling 1.39% by the close of the session.
In the U.S., benchmark 10-year Treasury bond yields -- which move inversely to prices -- rallied 8 basis points to 2.726% in early New York trading, the lowest in nearly a month, as investors looked for risk-free assets to park cash, while the U.S. dollar index was little-changed against a basket of six global currency peers at 102.045 in early European trading.
Zoom Video Communications (ZM) ended higher after the video conferencing specialists posted better-than-expected first quarter earnings, while boosting their full-year profit forecast, citing robust demand from businesses looking to extend hybrid work models.
Best Buy (BBY) ended higher, even after the electronics retailer posted weaker-than-expected first quarter earnings, while slashing its full-year sales outlook amid what CEO Corie Barry called "worsening" economic trends that have extended into the current quarter.
