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The Dow Jones Industrial Average traded 300 points less, or more than 1%. The S&P 500 and Nasdaq 100 futures contracts also fell by more than 1%.
Apple released quarterly results above analysts’ expectations, but its revenue growth has been flat year-over-year. In addition, the company did not provide advice for the quarter ending in June amid uncertainty about the coronavirus epidemic. The tech giant’s stock traded more than 1% in after-hours trading.
Another tech giant, Amazon, saw its shares fall 5% in after-hours trading after announcing plans to spend all of its second quarter profits on its response to coronaviruses. The e-commerce giant also posted profit in the first quarter which did not meet analysts’ expectations.
Apple and Amazon are among the companies that have led the return of the S&P 500 since the lows of late March and were two of the best performers in April. Amazon jumped nearly 27% in April while Apple jumped 15.3%.
“Dependence on a handful of stocks has masked widespread weakness in the past and, if they weaken, could mask widespread improvements in the future,” said Willie Delwiche, investment strategist at Baird , in a note.
Wall Street had just experienced its largest monthly increase in over 30 years, the S&P 500 gaining 12.7% while the Dow Jones rose 11.1%. It was the third highest monthly gain for the S&P 500 since World War II. The Nasdaq Composite closed up 15.5% for April, recording its biggest gain in a month since June 2000.
These gains are due in part to the hope of potential treatment for the coronavirus. Earlier in the week, Gilead Sciences said a study of its remdesivir by the National Institute of Allergies and Infectious Diseases had met its primary endpoint.
The number of new infections around the world has also decreased in recent weeks, which has prompted some American countries and states to slowly reopen their economies.
But Phillip Colmar and Santiago Espinosa, strategists at MRB Partners, urged investors to remain cautious.
“The strong rally in equities has now exceeded the underlying fundamentals, leaving room for short-term disappointment,” they said in a note to customers. “Many authorities are looking to reopen their economies, but doing so safely and near previous production levels will require a series of medical breakthroughs and wide distribution of the treatment. “
More than 3.2 million cases of the virus have been confirmed worldwide, according to Johns Hopkins University, with more than a million infections in the United States alone.
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