(Bloomberg) -- Megacap stocks slide in premarket trading on Wednesday after disappointing quarterly updates from Alphabet (NASDAQ: GOOGL ) and Microsoft Corp (NASDAQ: MSFT ), set to wipe off about $295 billion in market value from the biggest US companies.
The Google parent said on Tuesday it would slow hiring and control expenses, signaling that it was girding for tough times ahead as the economy falters, while Microsoft gave a lackluster Azure sales forecast. Both stocks were down approximately 6% in premarket trading.
“The main message is that expenses are being cut back,” said Neil Campling, an analyst at Mirabaud Securities. “Tech has got the memo that margin resilience is the focus and the days of speculative dollar spending on new projects are over.”
Nasdaq 100 Index futures slipped 1.6% in early trading Wednesday as the results refocused investor attention on the damage to earnings and the economy from the Federal Reserve’s rapid interest-rate hikes. The tech gauge has plunged more than 28% this year, on course for its worst annual performance since 2008.
Fellow megacaps Amazon.com Inc (NASDAQ: AMZN ), Meta Platforms Inc (NASDAQ: META ), Nvidia (NASDAQ: NVDA ), Tesla (NASDAQ: TSLA ) and Apple Inc (NASDAQ: AAPL ). fell between 3.9% and 0.7%. The Facebook parent is slated to report earnings later this afternoon.
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