Stocks trade lower at the open as investors digest corporate earnings

Yahoo Finance Live’s Brad Smith breaks down how stocks are trading following the opening bell on Tuesday.

Video transcript

JULIE HYMAN: And now we have the opening bell here on this Tuesday morning as investors try to parse through all of these earnings. They're looking at First Republic and trying to figure out what is going on in the banking sector and how they should be assessing it, not just for banks but sort of is there going to be a drop in loan growth? What effect is that going to have on the US economy?

That has gotten a lot of attention and a lot of discussion on the macro level even as we have the likes of a UPS, which is seen by many as a bellwether, right? It's a barometer of how much stuff is being shipped around the country and around the world, and it's seeing weakness.

So you have that on the one hand, Brad. You have a lot of the other companies reporting earnings on the other hand. We keep talking about mixed economic signals. By and large, earnings, I think, are coming out ahead of where people thought they would be. But if you're trying to get the read through to economics, it still feels mixed.

BRAD SMITH: Well, it might be interesting in terms of how the bellwethers have shifted too and some of those into even the technology landscape. And one of those could be arguably Microsoft, and we're going to get those earnings this week.

And particularly here looking at some of the activity out of the gate here as we're tracking the Dow Jones Industrial Average. We're flat, just barely to the downside right now. Over the past three days, we're still net higher by about 2/10 of a percent. I'll put this on a two-day view just so you can see kind of the activity over the course of yesterday, Monday, and then now as we're kind of getting into today's trading session where we may continue to trend. At least as of right now over the past two days still net higher, just barely by about 1/10 of a percent there for the Dow.

NASDAQ Composite, tech-heavy average. We saw tech sputtering a little bit out of the open yesterday. NASDAQ right now, you're seeing that down by about half a percent for the tech-heavy average. The S&P 500, you're seeing that down 4/10 of a percent and over the course of the past two days down by 3/10 of a percent there.

And so all of that considered, let's take a look at the 11 S&P 500 sectors here just to get a quick gander at where we may be trending, not just to start off today but as we move on throughout the rest of the day, we're going to have to make up some declines here that we've seen out of the gate in materials. Materials down one of the 1 and 1/4%. Energy, you're seeing that down by about 1.1% as well.

However, staples, that the lone gainer as of right now. You're seeing that flat. Just barely to the upside. Holding on to some green there by the hair of its chinny chin chin, as we like to call it. That's a technical term.

And then additionally here, XLV, you're seeing that trickle into positive territory. Health care, continue to watch that as we move on throughout the rest of today's trading session.

And then let's lastly take a look at some of those mega-cap tech stocks. Earnings reports starting to come through. We're going to get, of course, later on today for some of these tech companies. Microsoft and Google, we're going to be watching those very closely here for Alphabet or for Google, setting up their earnings here. Going into that, you're seeing a move lower, at least out of the gate this morning. Flat, just barely to the downside. Microsoft, though, that's down by about 8/10 of a percent, and sure to be some type of chatter around generative AI as well in search for both of those companies.

JULIE HYMAN: Yes. Yes. Maybe ChatGPT can ask questions on the-- but I guess somebody would have to prompt it. It can't do it by itself.

BRAD SMITH: ChatGPT, what would you ask Microsoft for it-- when it reports earnings?

JULIE HYMAN: On its earnings call. I like it. I like it. We should do that for sure.