US STOCKS-Wall Street Gives Up Gains, Investors Book Profits

Meta jumps on upbeat Q3 sales outlook

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Q2 advance GDP at 2.4% vs est 1.8%

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Indexes up: Dow down 0.44%, S&P 500 down 0.30%, Nasdaq down 0.1%

(Updated at 2:18 pm/1800 GMT)

By Carolina Mandl and Bansari Mayur Kamdar

July 27 (Reuters) –

U.S. stocks gave up earlier gains with each of the major indexes in negative territory and the Dow poised to snap its longest winning streak since 1987 as investors booked profits from a recent rally.

“It seems that morning enthusiasm has kind of faded,” said Brian Jacobsen, chief economist at Annex Wealth Management, adding investors were digesting an earnings season that delivered a mixed bag of results.

Meta gained 5.26% after it also reported a jump in second-quarter advertising revenue, topping Wall Street financial targets. Microsoft, which on Tuesday surpassed estimates for quarterly revenue and profit, was down 1.41%, as it laid out an aggressive spending plan to meet demand for its new artificial intelligence (AI)-powered services.

Outsized gains in megacap growth stocks have helped the Nasdaq lead the charge on Wall Street so far this year.

On Wednesday, the U.S. Federal Reserve raised interest rates by 25 basis points as expected. Traders now only see a 20% chance that the Fed could surprise with a quarter-point increase in September.

Fed Chair Jerome Powell said on Wednesday that Fed staff are no longer forecasting a U.S. recession, but did not rule out another rate hike, as he said the Fed would follow future economic data.

On Thursday, a Commerce Department report showed the economy grew faster than expected in the latest quarter.

“For now, the indicators are still pointing toward a relatively soft economic landing,” said Mike Loewengart, head of model portfolio construction at Morgan Stanley Global Investment Office.

The Dow Jones Industrial Average fell 155.68 points, or 0.44%, to 35,364.44, the S&P 500 lost 13.61 points, or 0.30%, to 4,553.14 and the Nasdaq Composite dropped 14.83 points, or 0.1%, to 14,112.46.

EBay forecast third-quarter profit below market expectations as the e-commerce platform spent more to bolster categories such as auto parts, refurbished goods and collectibles, sending its shares down 9.58%.

Chipmakers including Nvidia and Micron rose 2.98% and 1.21% respectively after Lam Research forecast upbeat quarterly sales. Shares of Lam advanced 9.44%.

Southwest Airlines tumbled 9.42% after the airline posted a dip in second-quarter profit, while Royal Caribbean surged 9.73% after the cruise operator lifted its annual profit forecast.

Elsewhere, the

European Central Bank

raised interest rates for the ninth consecutive time and kept the door open to further tightening.

Declining issues outnumbered advancing ones on the NYSE by a 1.60-to-1 ratio; on Nasdaq, a 1.96-to-1 ratio favored decliners.

The S&P 500 posted 50 new 52-week highs and one new low; the Nasdaq Composite recorded 87 new highs and 72 new lows.

(Reporting by Bansari Mayur Kamdar and Johann M Cherian in Bengaluru; Editing by Shinjini Ganguli, Maju Samuel and Deepa Babington)