Markets live: ASX set to edge up despite $US500b Alphabet share slump overnight
Alphabet's shares fell 12.6% after Q3 results missed expectations, with negative free cash flow of $9.1B. Amazon also dropped 6% post-earnings, reporting EPS of $1.89 vs. $1.97 expected. Tech sector declines dragged Nasdaq down 1.4%. ECB kept rates unchanged, with Lagarde announcing her departure. Markets expect a 90% chance of an RBA rate hike next week.
How this was made
The 30-second read
Why it matters
Alphabet and Amazon are singled out for negative cash-flow and capex intensity, while Microsoft’s dip is attributed to debt-financing plans. Intel’s large post-market drop reinforces a tech-led risk-off tone that is expected to spill into the next session.
Market read
Traders get a same-session earnings reaction read-through for mega-cap tech, plus a macro calendar backdrop (ECB/BoJ/RBA) that can amplify volatility.
What to watch
The article emphasizes cash-flow optics but does not quantify whether capex is front-loaded for near-term capacity or whether working-capital timing explains part of the free-cash-flow weakness.
Background
The piece is a live markets wrap that ties US tech earnings reactions (Alphabet, Amazon, Microsoft) to a broader macro backdrop of central-bank decisions and commodity moves.
Ticker impact
Amazon’s Q3 results missed EPS expectations and capex surged, with shares down about 6% in after-hours trade.
Likely further pressure as the market digests the capex and cash-flow deterioration alongside the EPS miss.
The article cites an EPS miss, very large capex versus expectations, negative trailing free cash flow, and a same-session after-hours drop.
Intel is cited as down about 20% in post-market trade, contributing to a tech-led risk-off tone.
Likely continued weakness at the open as traders extend the post-market selloff into the next session.
The article provides the size of the move but does not include the specific underlying catalyst for INTC in the provided text.
Microsoft is described as dipping despite 19% revenue growth, tied to plans to issue US$25 billion in debt for infrastructure.
Likely muted reaction or modest downside as investors weigh financing costs versus AI/infrastructure plans.
The article links the dip to the debt issuance plan, but does not quantify a broader fundamental change beyond that framing.
Alphabet shares plunged 12.6% after results, with negative free cash flow for a second consecutive quarter and higher AI-related capex.
Likely sustained downside pressure as markets reprice the timeline for capex-to-cloud revenue conversion and free-cash-flow recovery.
The article cites the magnitude of the selloff, negative free cash flow, EPS/revenue misses, and management’s plan to increase investment spending.
Market effects
Tech-heavy selloff is framed as a shift from rewarding AI spend to scrutinizing how it is financed, pressuring high-capex software/cloud names.
ASX is set to edge up but the article expects a subdued open due to US tech weakness and commodity declines that can weigh on miners.
The narrative links US tech cash-flow concerns to broader risk appetite, while central-bank policy expectations (ECB/BoJ/RBA) add macro volatility.
Counterpoint
Alphabet’s cloud momentum (Google Cloud revenue growth and margin expansion) could offset cash-burn fears if investors believe capex converts faster than the market expects.
Key entities
- companyAlphabet
Alphabet’s Q3 results and AI-related cash burn drove a sharp share selloff, with negative free cash flow and higher planned capex.
- companyAmazon
Amazon’s Q3 EPS miss and much higher-than-expected capex contributed to an after-hours decline.
- companyMicrosoft
Microsoft’s shares dipped despite revenue growth, linked to plans to issue US$25 billion in debt for infrastructure.
- companyIntel
Intel is cited as down sharply in post-market trade, contributing to the tech selloff narrative.
- central_bankEuropean Central Bank
ECB held rates unchanged and signaled a data-dependent approach, with Lagarde set to depart in February.
