CNBC Daily Open: For Big Tech, beating earnings expectations is not enough

Prices accrued successful enactment with expectations  
The U.S. personal depletion expenditures scale accrued 0.2% successful September, connected a monthly and seasonally adjusted basis, reported the U.S. Commerce Department. The 12-month ostentation complaint was 2.1%. Both numbers were successful enactment with Dow Jones estimates. The halfway ostentation rate, which excludes nutrient and vigor prices, came successful astatine 2.7%. 

Big Tech drags down markets 
Major U.S. indexes slumped connected Thursday, weighed down heavy by losses successful Big Tech shares. All 3 indexes fell for the month. Europe's Stoxx 600 scale slid 1.2% to extremity October 3.4% lower, according to LSEG data, marking its worst monthly performance successful a year. Separately, inflation successful the euro zone successful October roseate to 2%, much than expected. 

Apple and Amazon bushed estimates 
Apple's fiscal fourth-quarter net and revenue exceeded LSEG statement estimates. The Cupertino-based company's iPhone gross grew 6%. Meanwhile, Amazon besides bushed Wall Street's expectations for its third-quarter net and revenue. While the company's unreality part missed gross expectations, it's increasing faster than it had successful the aforesaid play past year. 

New declaration connection for Boeing workers 
Boeing and its machinists' national person reached a caller declaration offer that whitethorn extremity a seven-week-long onslaught involving much than 32,000 machinists. The caller connection bumps up wage increases and gives the enactment of a ratification bonus. Voting is scheduled for Monday, and the national urged its members to o.k. the contract. 

[PRO] Lowest currency level successful communal funds 
The U.S. statesmanlike predetermination is little than a week away. Usually, this uncertainty portends volatility successful markets. But cash levels successful communal funds are astatine their lowest level connected record, according to Bank of America, suggesting money managers are unafraid of deploying currency into the markets. CNBC Pro's Jesse Pound explains what that means for markets.  

Expectations for Big Tech are truthful precocious that, ironically, beating expectations is nary longer capable for them.  

Take Microsoft, for one. The institution handily bushed Wall Street's estimates – quarterly gross was $1 cardinal much than expected and nett income jumped 11% from the year-ago 4th – but its shares sank 6.1% Thursday. A blimpish forecast for the 4th ending December disappointed investors, and gave Microsoft its worst time since Oct. 26, 2022. 

The picture's astir the aforesaid with shares of Meta and Apple. Even Alphabet shares, which roseate astir 3% aft reporting net connected Wednesday, retreated 1.9% Thursday. 

"I deliberation we're getting to the constituent wherever AI enthusiasm and imaginable is not enough. These companies … are not rather delivering the maturation that is priced into them," said Ross Mayfield, concern strategist astatine Baird Private Wealth Management. 

The magnitude of the losses successful those Big Tech companies dragged down the Nasdaq Composite, which fell 2.76%. The S&P 500, weighted heavy towards those megacap corporations, tumbled 1.86%. Both indexes had their worst time since Sept. 3. The Dow Jones Industrial Average mislaid 0.9%. All indexes ended October successful the red. 

Some analysts, however, are inactive optimistic astir Big Tech's catalyst to the maturation of stocks. 

"The continued maturation successful AI-related capex reported by each 3 tech giants supports the affirmative structural trend," Solita Marcelli, UBS Global Wealth Management's CIO for the Americas, wrote successful a note. Marcelli was referring to Microsoft, Alphabet and Meta. 

Likewise, Piper Sandler's main marketplace technician Craig Johnson wrote to clients that "the wide method grounds remains constructive, and the superior inclination of the large averages is higher," adjacent if determination are "near-term pullbacks oregon humble profit-taking."  

Therein lies the outsized load connected Big Tech. Investors and analysts don't conscionable expect those companies to bushed estimates. They besides privation megacap companies to thrust markets, which is contingent much connected maturation prospects than earnings.  

In essence, Big Tech, more than immoderate different sector, has to fulfill expectations for some the past and the aboriginal astatine the aforesaid time. 

— CNBC's Jordan Novet, Jesse Pound, Alex Harring, Hakyung Kim and Brian Evans contributed to this report.