Alphabet and Caterpillar Shares Fall as Earnings Pressure Stocks

US stock futures declined Thursday as disappointing quarterly results from Alphabet and weaker-than-expected construction industry sales at Caterpillar weighed on investor sentiment. The declines came as investors assessed corporate earnings, artificial intelligence infrastructure spending and the Federal Reserve's latest interest rate decision, with major technology and industrial shares facing renewed pressure before the market opened.

Nasdaq-100 futures fell 1.3%, while S&P 500 futures slipped 0.5%, according to the market figures reported by CNBC. Dow Jones Industrial Average futures dropped 171 points, or 0.3%. Alphabet shares lost 10% in premarket trading, while Caterpillar fell 9% despite reporting quarterly earnings and revenue above analysts' expectations.

Alphabet, Google's parent company, missed third-quarter expectations for adjusted earnings per share and revenue. The company reported negative free cash flow of $9.07 billion and maintained its full-year capital expenditure forecast at $195 billion to $205 billion.

Caterpillar reported adjusted earnings of $7.20 per share on revenue of $20.68 billion, according to LSEG figures cited by CNBC. Analysts had expected earnings of $7.08 per share and revenue of $20.55 billion. However, sales in the company's construction industries business fell slightly short of estimates.

Microsoft shares moved in the opposite direction, rising 2.6% before the opening bell. Growth in its Azure cloud infrastructure business helped the software company exceed analysts' expectations for revenue and earnings in its fiscal first quarter, according to LSEG data reported by CNBC.

Companies providing cloud infrastructure capacity for artificial intelligence workloads declined after Microsoft's capital expenditure figure came in below expectations. The spending outlook raised concerns that infrastructure partners could take longer to deliver data center capacity.

Artificial intelligence-related investments also remained under pressure. The iShares Semiconductor ETF, known by the ticker SOXX, fell more than 2%, while the Roundhill Memory ETF, trading as DRAM, declined more than 3% on Thursday. Both funds had experienced a difficult October before recovering in recent trading sessions.

The Federal Reserve held its benchmark interest rate within a range of 3.75% to 4% on Wednesday, a widely anticipated decision following the Federal Open Market Committee's quarter-percentage-point hike in September. Policymakers said inflation remained elevated and indicated they wanted more information before taking further action.

Daniel Siluk, head of global short duration and liquidity at Janus Henderson Investors, characterized the decision as a sign of patience rather than a fundamental change in the central bank's approach.

"The door remains open to further tightening, but the Committee appears willing to wait for incoming data to validate the need for additional action."

Siluk said the decision could be interpreted as mildly dovish at the margin, while emphasizing that policymakers had not abandoned their tightening bias. The central bank's next steps will depend on incoming economic data.

Elsewhere in premarket trading, DoorDash rose 7% after announcing an agreement to acquire Maplebear, the parent company of Instacart, for $65 per share. The proposed price represented an 11% premium to Maplebear's Wednesday closing price. DoorDash also reported third-quarter revenue and earnings before interest, taxes, depreciation and amortization above expectations, while Maplebear shares were unchanged after trading resumed.

Eli Lilly shares gained 4.5% after the pharmaceutical company exceeded third-quarter forecasts. The maker of Zepbound and Mounjaro reported adjusted earnings of $7.48 per share, compared with the $6.26 consensus estimate, according to LSEG. Revenue reached $24.4 billion, exceeding analysts' expectations of $22.61 billion.

Norwegian Cruise Line shares climbed 13% after the cruise operator beat earnings and revenue estimates. The company reported adjusted earnings of $1.12 per share, above the FactSet consensus of 93 cents, while revenue totaled $2.95 billion against expectations of $2.88 billion.

Chipotle Mexican Grill shares rose 7.6% before the opening bell following mixed quarterly results. Revenue matched expectations, while earnings per share fell slightly short. The restaurant chain recorded same-store sales growth for a third consecutive quarter but faced signs of softer customer traffic toward the end of the third quarter and into October as consumers continued to contend with inflation. Chipotle plans to open between 340 and 360 company-owned locations in 2027.

Airbus shares gained as much as 2.3% after the aircraft manufacturer reported quarterly revenue of 17.5 billion euros, equivalent to $19.5 billion, below FactSet expectations of 18.1 billion euros. Adjusted earnings before interest and tax came in at just under 1.8 billion euros, exceeding the expected 1.75 billion euros.

Airbus faces production challenges linked to supply chain constraints, including shortages of Pratt & Whitney engines, and quality issues affecting deliveries. The company reaffirmed its target of delivering 870 aircraft in 2026, above its 2019 record of 863. Meeting the goal requires 323 deliveries in the fourth quarter.

Airbus Chief Financial Officer Thomas Toepfer expressed confidence in meeting the annual target, citing improvements in supply chain conditions and the availability of materials needed for fourth-quarter deliveries.

"The good thing is, in terms of supply chain, that has really become better than it was a year or two years ago,"

Toepfer said Airbus had the materials required at its factories to support the planned delivery schedule. The company must complete a substantial share of its annual deliveries during the final quarter.