US STOCKS-Nasdaq falls as megacaps drop ahead of earnings, Fed meet in focus


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      Apple, Meta, Alphabet, slide ahead of earnings

      Fed decision on interest rates on Wednesday 

      Indexes down: Nasdaq 1.29%, S&P 0.74%, Dow 0.23%

 (Adds comments, details; updates prices)
    By Shreyashi Sanyal and Johann M  Cherian
       Jan 30 (Reuters) - The tech-focused Nasdaq fell more
than 1% on Monday as megacap growth stocks including Apple,
Amazon and Alphabet fell ahead of their earnings reports this
week, while investors awaited the U.S. Federal Reserve's
rate-setting meeting. 
    The central bank is seen hiking the Fed funds rate by 25
basis points (bps) at the end of its two-day policy meeting on
Wednesday, followed by Fed Chair Jerome Powell's speech, which
will be scrutinized for any signs of further increases.  
    "How strong of a language he (Powell) uses is what it's
going to come down to," said Andre Bakhos, president at Ingenium
Analytics LLC in Bernardsville, New Jersey.     
        This will likely be the smallest rate increase since the
Fed kicked off its tightening cycle 10 months ago with a 25 bps
hike, with financial markets pricing in a final rate hike in
    Money markets now see rates peaking at 4.9% in June, still
below the 5% level expected by Fed policymakers.  0#FEDWATCH 
    After a slew of layoffs by large-cap tech and financial
firms through the month, investors will now keep an eye on the
Labor Department's January nonfarm payrolls data expected on
    A total of 107 S&P 500 firms are expected to report
quarterly results in the busiest week of the earnings season,
including heavyweight growth companies Apple Inc  AAPL.O , Inc  AMZN.O , Alphabet Inc  GOOGL.O  and Meta
Platforms Inc  META.O , each down between 1% to 2%. 
    Analysts expect S&P 500 earnings for the fourth quarter to
decline 3%, compared with a 1.6% drop expected at the beginning
of the year, according to Refinitiv data.
    Wall Street is expected to end the month higher, with the
Nasdaq  .IXIC  and the S&P 500 Growth index  .IGX  recouping
more than half their monthly losses from December. The S&P 500
index  .SPX  is set for the best start to the year since 2019. 
    Tighter monetary policies have stood in the way of growth
firms expanding their businesses, which have also been pressured
for much of last year by high Treasury yields.
    Bakhos said that the decline in growth stocks on Monday
could be due to some profit-taking, noting that earnings from
these companies could be less dire than what most expect.
    The European Central Bank and the Bank of England are also
seen raising interest rates later in the week. 
        At 12:31 p.m. ET, the Dow Jones Industrial Average
 .DJI  was down 79.27 points, or 0.23%, at 33,898.81, the S&P
500  .SPX  was down 30.03 points, or 0.74%, at 4,040.53, and the
Nasdaq Composite  .IXIC  was down 149.66 points, or 1.29%, at
    Johnson & Johnson  JNJ.N  slipped 3% on the dismissal of a
bankruptcy petition filed by its LTL Management unit by the 3rd
U.S. Circuit Court of Appeals. 
    American Express Co  AXP.N  rose 2.7% after several
brokerages raised price targets on the stock on its strong
full-year forecast.
    Declining issues outnumbered advancers for a 1.70-to-1 ratio
on the NYSE and for a 1.66-to-1 ratio on the Nasdaq.
    The S&P index recorded five new 52-week highs and no new
lows, while the Nasdaq recorded 46 new highs and 13 new lows.
 (Reporting by Shreyashi Sanyal and Johann M Cherian in
Editing by Vinay Dwivedi and Anil D'Silva)
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