Alphabet sinks 10% and drags Nasdaq futures lower
Published on October 29, 2026
Alphabet is down almost 10% after hours, and it is pulling Nasdaq futures lower with it this Thursday. Nasdaq 100 futures are off 1.1% while Dow futures are up. The day is only getting started: GDP and PCE hit at 8:30 a.m. ET, and the ECB decides 15 minutes before that.
Alphabet drags Nasdaq futures lower before the open
Alphabet missed on both revenue and profit on Wednesday night. That is its first double miss in nearly four years, Reuters reported via The Pioneer. The stock dropped about 10% in late trading, per the AP.
The weak spot is the core business. Google advertising brought in $82 billion against $83.6 billion expected, Yahoo Finance reported. Management blamed slower search ad growth on AI Mode, its AI powered search, which earns less for now, InvestingLive noted.
The cash is the bigger worry. Free cash flow came in at negative $9.1 billion, the second straight quarter in the red, Gulf News pointed out. Alphabet kept its 2026 capex plan at $195 billion to $205 billion and said spending will rise significantly in 2027, CNBC reported.
As of 2:43 a.m. ET, Nasdaq 100 futures were down 1.1% at 29,647.75, S&P 500 futures were off 0.3% and Dow futures were up 0.4%, Investing.com reported. TipRanks showed a similar split.
Microsoft passes the test Alphabet failed
Microsoft beat. Azure revenue grew 48% to $33.2 billion, above the $32.3 billion forecast, and the company guided to 49% to 50% growth this quarter, per Gulf News. The stock rose close to 3% after hours.
The split tells you how the market grades AI spending now. Big budgets are fine while free cash flow stays positive, as it does at Microsoft. Burn cash and you get punished. Asia followed the same script overnight, with the Kospi down 2.2% and Samsung off 5.4% after weak results, the AP said.
A firm Fed and a 10 year yield near 5%
On Wednesday the Fed held its range at 3.75% to 4%. Lisa Cook and Beth Hammack dissented in favor of a hike, according to CappNotes. Chair Kevin Warsh made no promise on December. Traders now see 81.8% odds of a December hike, up from 75% a week ago, based on CME FedWatch data cited by Investing.com. The 10 year yield topped 5% on Wednesday and sits just below it this morning.
Stocks still closed higher. The S&P 500 rose 0.28% to 7,743.98, the Nasdaq Composite 0.27% to 26,549.85 and the Dow 0.19% to 52,475.10. EUR/USD finished at 1.1155, up 0.30%. Brent is down 1.2% near $110 this morning.
The ECB is expected to hold its deposit rate at 2.50%. Holger Schmieding, chief economist at Berenberg, expects the bank to signal that the latest oil spike has tilted inflation risks higher, Reuters reported. Christine Lagarde will also face questions on French bonds and on her own future.
Key levels today
| Instrument | Level (support / resistance) | Change | Scenario / What to watch |
|---|---|---|---|
| Nasdaq Composite | 25,955 / 26,703 | +0.27% (Wednesday session), Nasdaq 100 futures -1.1% this morning | TradingNerve calculation: lowest and highest close from Oct 21 to Oct 28. A close below 25,955 erases the whole rebound. |
| S&P 500 | 7,624 / 7,757 | +0.28% (Wednesday session) | TradingNerve calculation, same method. Back above 7,757 would mean the Alphabet hit has been absorbed. |
| EUR/USD | 1.1120 / 1.1200 | +0.30% (Wednesday session) | TradingNerve calculation: 1.1120 is Tuesday's close, 1.1200 a round number. A hawkish ECB points to 1.1200, a hot PCE to 1.1120. |
| Dow Jones | 52,215 / 52,868 | +0.19% (Wednesday session), futures +0.4% this morning | TradingNerve calculation: lowest and highest close from Oct 21 to Oct 28. Above 52,868 the rotation out of tech is in charge. |
Economic calendar
- 8:15 a.m. ET, ECB decision, press conference at 8:45. If Lagarde clearly opens the door to December, the euro gains. If she leans on French risk, EUR/USD can slip.
- 8:30 a.m. ET, Q3 GDP, advance estimate. Forecasts run from 2.8% at Continuum Economics to 3.5% for the Atlanta Fed's GDPNow, after 2.2% in Q2, per FatTail. Above 3.5%, yields climb and the Nasdaq takes another hit. Below 2.5%, rates get some relief.
- 8:30 a.m. ET, September core PCE. The Cleveland Fed nowcast sees +0.28% on the month and about 3.05% on the year, after 3.0% in August. A 0.4% print or higher would lock in a December hike. At 0.2%, pressure eases.
- After the close. Amazon and Intel report.
What it changes for your session
- No new positions from 8:10 to 8:50 a.m. ET, a window that covers the ECB, GDP and PCE.
- Nasdaq 100 futures are the most nervous instrument today, with a gap of more than 1% at the open. Size down from your usual position.
- The Dow and the Nasdaq are moving in opposite directions. Do not read the S&P 500 alone, watch the spread between them.
- Today's read breaks if the Nasdaq Composite gets back above 26,550, Wednesday's close, within the first hour.
- After a gap of more than 1%, wait for the first 15 minute candle to close at 9:45 a.m. ET before acting.
The bottom line
Alphabet shows the market no longer pays for AI blindly, and cash burn now gets punished. The Nasdaq opens under pressure, and GDP, PCE and the ECB can push the move further before the bell.
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This content is for information only. This is not investment advice.