Jan 30 (Reuters) - The S&P 500 was muted on Thursday as losses in tech heavyweights Microsoft and Nvidia countered earnings-led gains for Meta and Tesla, while investors parsed a slew of corporate earnings a day after the U.S. central bank held interest rates steady.
Microsoft (MSFT.O), dropped 6.2% after forecasting disappointing growth in its cloud computing business, while Meta Platforms (META.O), added 1.8% after beating fourth-quarter revenue estimates.
Commenting on Microsoft's results, Victoria Fernandez, chief market strategist at Crossmark Global Investments, said that "people were waiting to hear something fantastic, and they just didn't hear it".
"They were also waiting to hear if there was going to be any kind of decline in capex spending, and they didn't really get that either," Fernandez said.
On Wednesday, the chief executives of both Meta and Microsoft defended their heavy investments in artificial intelligence, just days after Chinese startup DeepSeek unveiled a breakthrough in cheap AI models that rattled Wall Street and triggered a bloodbath in AI-linked stocks.
Meanwhile, Tesla (TSLA.O), gained 2.1% in choppy trading after saying it was on track to roll out new, cheaper EV models in the first half of 2025. It also said it would start testing a paid autonomous car service in June, overshadowing quarterly results that fell short of expectations.
At 11:28 a.m. ET, the Dow Jones Industrial Average (.DJI), rose 45.95 points, or 0.10%, to 44,756.73, the S&P 500 (.SPX), gained 5.56 points, or 0.10%, to 6,045.14 and the Nasdaq Composite (.IXIC), lost 58.13 points, or 0.30%, to 19,573.85.
Ten of the 11 S&P 500 sectors traded higher, with outlier information technology (.SPLRCT), down 1.2% after Nvidia's (NVDA.O), 3.8% drop exacerbated losses.
Of the 149 S&P 500 companies that have reported earnings so far, 73.2% posted numbers that exceeded analyst estimates, according to data compiled by LSEG.
United Parcel Service (UPS.N), lost 17.5% after forecasting 2025 revenue below expectations, dragging the Dow Jones Transport Average (.DJT), down 1%.
Lam Research (LRCX.O), rose 8% after the chip-making equipment supplier forecast third-quarter revenue above expectations, while Comcast (CMCSA.O), lost 12.5% after reporting a steep decline in broadband subscribers for the fourth quarter.
The focus will now be on Apple (AAPL.O), and Intel (INTC.O), opens new tab, which are scheduled to report results after markets close.
The U.S. Federal Reserve kept interest rates unchanged on Wednesday, removing language acknowledging easing inflation from its latest policy meeting statement. Chair Jerome Powell said there would be no rush to cut rates again until inflation and job numbers made it appropriate.
Data showed earlier on Thursday that U.S. economic growth slowed in the fourth quarter, while a jobless claims report for the previous week saw claims falling lower than expected.
The economically sensitive Russell 2000 small-cap index (.RUT), was last up 1.2%.
Among other movers, IBM (IBM.N), jumped 12.7% after the company surpassed fourth-quarter profit expectations. ServiceNow (NOW.N), lost 13.1% after the software firm forecast annual subscription revenue below Wall Street estimates.
Advancing issues outnumbered decliners by a 4.42-to-1 ratio on the NYSE, and by a 2.1-to-1 ratio on the Nasdaq.
The S&P 500 posted 37 new 52-week highs and nine new lows, while the Nasdaq Composite recorded 78 new highs and 80 new lows.
Reporting by Shashwat Chauhan and Sukriti Gupta in Bengaluru; Editing by Pooja Desai and Shounak Dasgupta
