23/07/24 Briefing

US stocks slipped on Tuesday as investors weighed early reports on a marquee earnings day, with Big Tech results from Alphabet and Tesla in focus after hours.

The benchmark S&P 500 (^GSPC) and Dow Jones Industrial Average (^DJI) dropped about 0.2% and 0.1%, respectively, with the tech-heavy Nasdaq Composite (^IXIC) finishing the day just below the flatline.

Markets have been digesting a rotation away from the megacaps that have fueled this year's rally. Small caps have benefitted as a result with the Russell 2000 (^RUT) up 3% over the past two days.

In the kickoff to "Magnificent 7" earnings, Alphabet (GOOGL, GOOG) and Tesla (TSLA) both reported mixed quarterly results after the bell.

Google parent Alphabet delivered a beat on both the top and bottom lines. The company praised its search and cloud businesses, announced a $0.20 cash divided, and reported better-than-expected advertising revenue. But network revenue, services revenue, along with subscriptions, platforms and devices revenue disappointed. Shares ticked lower.

Tesla missed earnings expectations in the second quarter but delivered a beat on the top line. It reported gross margin of 18%, ahead of consensus calls of 17.4% But a miss on free cash flow, capital expenditure and operating income led to a drop in the stock in after-hours trading with shares down more than 5%.

Earlier in the session, investors assessed earnings from General Motors (GM) and Coca-Cola (KO). GM shares closed down about 6%, while Coca-Cola finished the day flat.

Read more: 32 charts that tell the story of markets and the economy right now

Meanwhile, volatility around the US presidential election has ebbed over the past two days. Vice President Kamala Harris is projected to have secured delegate backing to become the Democratic presidential nominee, helping settle any remaining nerves over President Joe Biden's withdrawal from the race.