Nasdaq jumps, supported by Microsoft results: Stock market news today

U.S. stocks edged higher on Wednesday, led by the Nasdaq, as investors begin to digest the big tech earnings bonanza that has kicked off this week.

The S&P 500 (^GSPC) and the Dow Jones Industrial Average (^DJI) rose around 0.2% at the open. The tech-heavy Nasdaq Composite (^IXIC) climbed 0.91%.

Government bonds was mixed. The yield on the 10-year note fell to 3.39%, while interest-sensitive two-year note yields also fell to 3.88% on Wednesday morning.

Tech giants Microsoft ( MSFT ) and Alphabet ( GOOGL ) both reported better-than-expected earnings and revenue for the latest quarter after the close on Tuesday.

Microsoft ( MSFT ) surged more than 7% on Wednesday morning after the software giant reported third-quarter financial earnings that beat estimates, indicating growing strength in its AI and cloud businesses. Microsoft earned $2.45 per share on revenue of $52.9 billion, compared with a profit of $2.22 per share on $49.4 billion in sales in the same period a year ago.

However, Microsoft̵[ads1]7;s potential acquisition of Activision Blizzard ( ATVI ) suffered a setback Wednesday morning, when British regulators blocked the deal over competition fears. Activision shares were down about 9% Wednesday morning.

Alphabet’s ( GOOGL , GOOG ) first-quarter earnings showed a 2% increase in search revenue, well below the corresponding quarters from the past two years. Meanwhile, installs of the Bing app quadrupled after it was augmented with AI. The shares rose slightly in early trading.

Meta ( META ) earnings are up next after the clock on Wednesday, while Amazon ( AMZN ) reports Thursday.

Technology stocks have driven the stock rally so far this year, but some analysts expect the sector could come under selling pressure as it loses momentum. Investors remain concerned that expectations for earnings growth will be weaker, prompting some market strategists to predict a decline that has so far not materialized.

Nasdaq jumps, supported by Microsoft results: Stock market news today

FILE – The Microsoft logo is pictured outside its headquarters in Paris, January 8, 2021. (AP Photo/Thibault Camus, File)

Separately, on the banking front, PacWest Bancorp ( PACW ) reported earnings after the close that topped EPS estimates, sending the stock higher on Tuesday.

That action in the banking sector followed First Republic Bank’s (FRC) stock plunging nearly 50% after the regional lender reported a bigger-than-expected drop in deposits on Monday. The bank is considering asset sales, Bloomberg reported, following the collapse of Silicon Valley Bank and the turmoil in the sector. First Republic appeared to extend Wednesday’s rout, as it fell about 15% Wednesday morning.

First Republic’s drastic move to the downside on Tuesday dragged down the KBW Regional Banking Index, which fell to its lowest level since November 2020.

At the same time, the consumer remains in good shape despite a decline in inflation. Visa ( V ) reported earnings that beat top- and bottom-line expectations for the latest quarter on Tuesday that showed continued post-pandemic recovery in international travel.

Elsewhere, mortgage applications rose for the second time in the past three weeks, signaling stabilization in the housing market, according to the Mortgage Bankers Association’s weekly survey. Other data on Wednesday showed U.S. manufactured good orders took a hit in March from new passenger aircraft contracts.

Dani Romero is a reporter for Yahoo Finance. Follow her on Twitter @daniromerotv

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