S&P 500 Ends Three-Day Surge as Alphabet Shares Plunge: Greed Index Remains in ‘Fear’ Zone

Key takeaways

• The S&P 500’s pullback after a three‑day surge, driven by Alphabet’s earnings miss and a still‑strong economy, keeps sentiment in a cautious zone.
• S&P 500 fell 0.30% to 7,720.39
• Nasdaq Composite tumbled 1.38% to 26,184.72
• Alphabet shares dropped over 12%

What happened

The S&P 500 ended a three‑day rally, falling 0.30% to 7,720.39, while the Nasdaq Composite dropped 1.38% to 26,184.72. Alphabet Inc. shares (GOOGL/GOOG) plunged over 12% after reporting weaker‑than‑expected Q3 earnings and revenue. Caterpillar Inc. (CAT) slid about 9% following its quarterly results. The CNN Money Fear & Greed Index ticked up slightly to 35 but stayed in the "Fear" zone. U.S. GDP grew at a 3.4% annualized pace in Q3, above the 3.2% consensus, and core

Why it matters

The market pullback signals that the recent rally may have been driven by optimism that is now cooling. Alphabet’s sharp decline highlights concerns about tech earnings and valuation pressure. The stronger‑than‑expected GDP and lower unemployment support a view that the economy is still robust, which could temper the…

Short-term and longer-term

Short-term. Over the next few days, watch for a rebound in tech stocks if Alphabet’s earnings miss is seen as a one‑off.

Longer-term. For the coming months, the stronger GDP and low unemployment support a view that the economy is still on track, but the tech sector’s weakness could weigh on long‑term growth prospects.