The downside of the profits of United States-listed companies will come to an end, but the fall in the stock market makes no sense at all.
With the third quarter of the financial season approaching half, a comprehensive analysis of the average financial performance and the expectations of the analysts by FactSet shows that the profits of the 500 index stock company are expected to increase by 2.7 per cent over the same period. If that were the case, it would be the first profitable growth in four quarters.
However, few companies are receiving returns for their performance being higher than expected. FactSet data show that between the two days before the release of the financial paper and the two days after its release, the stock price of the higher-than-anticipated 500 index stock company declined by an average of 1 per cent, compared with an average increase of 0.9 per cent over five years.



This is particularly true of the technology blocks that were soared before. For example, Alphabet, the Google parent company, achieved the strongest business growth in more than a year, but the market value dropped by nearly $168 billion last week. After the parent companies of Facebook and Instagram, Meta Platforms, announced that they had achieved the highest quarterly revenues since they were listed in 2012, the market value fell by over $30 billion.



“The profit downturn is almost over, but look at the technology ‘The Seven’, the price of which is perfect, so I am not surprised,” Gina Bolvin, President of the Bolvin World Management Group, said, on the first half of the year, when these technology units led the US stock market.
The pressure on the technology plates spread to other areas of the United States stock market. The NASDAQ composite index fell by 2.6 per cent last week, and the wider General Standard 500 index by 2.5 per cent. Both indicators have experienced a reversal, down by more than 10 per cent from the high points reached in July. Both indices, however, have so far maintained a positive increase of 21 per cent and 7.2 per cent, respectively, in 2023.
Investors will focus on Apple in the next few days to find further clues about the health of the technology industry. The iPhone manufacturer Apple will publish its financial statements on Thursday, and profits are expected to jump by 7.8 per cent. On November 21, Nvidia, a graphic chip manufacturer at the centre of the generation AI tide, will release a financial statement.
The delivery of the Unit began in August. Strong economic data and the rising budget deficit in the United States contributed to high rates of return on United States Treasury debt, providing investors with a risk-free option for financial inputs. When the rate of return rises, investors are reluctant to buy corporate shares that promise high growth in the future. For the first time in 16 years, the 10-year rate of return on the United States Treasury debt had reached 5 per cent, which had exacerbated the sale of the technology unit.
Some investors fear more volatility in the future. The sales of the Alphabet cloud computing business have been weak, disillusioning investors, while the company continues to compete fiercely with its AI development counterpart. The market value of Alphabet was the largest weekly decline recorded last week.


The market value of Meta Platforms fell by over $30 billion after it announced that it had achieved the highest quarterly income since it was listed in 2012.

At the same time, Meta was cautious about future advertising expenditures and warned that the operating losses could increase as a result of product development in the Reality Labs sector.
“It is normal that, once profits decline, stock prices will not actually rise, and so stock prices are stagnating. And as soon as the company publishes another strong quarterly financial report, you expect that, at some point, this will start to be reflected in the stock price, says Ivana Delevska, founder and chief investment officer of Spear Invest.
Not all of them are bad news for large technology companies. Amazon has published impressive performances, resulting in its stock price rising by 6.8 per cent last Friday, the largest single-day increase since early August. The e-commerce giant claimed that profits in the recent fiscal season had tripled to nearly $10 billion, thanks to strong sales in the cloud computing, advertising and retail sectors.


According to Amazon, profits from the recent fiscal season have tripled to nearly $10 billion, thanks to strong sales in the cloud computing, advertising and retail sectors.

Microsoft (MSA) stock prices climbed 3.1 per cent last Wednesday, the largest single-day increase since July. It had previously indicated that its cloud computing service demand had increased and sales growth had accelerated as a result of increasing market enthusiasm for AI.
Although some of these technological giants have recently returned stocks, valuations still appear to be quite high compared to historical levels. Microsoft ' s market gain rate based on expected gains over the next 12 months is 28 times higher than its 10-year average of about 23 times. Apple ' s market share, based on future earnings, is about 25 times, while its average market gain is nearly 19 times. This compares with a ratio of 17 times the ratio of earnings to the 500 index.
Some investors are already searching for stocks that they consider to be so deep that they can regain their appeal. Nancy Tengler, Chief Executive Officer of Laffer Tengler Investments, stated that she had recently acquired additional shares in Oracle and Adobe.
“The same thing happened last year, when we heard that the science and technology unit had ended”, she said. "If you sell shares at this time last year, you've lost a lot of excess earnings."