Wall Street declines with Amazon; S&P 500 on track for monthly gain

© Reuters. FILE PHOTO: A Wall Street sign is pictured outside the New York Stock Exchange in New York, October 28, 2013. REUTERS/Carlo Allegri

By Caroline Valetkevitch

NEW YORK (Reuters) - U.S. stocks were lower in afternoon trading on Friday with Amazon.com falling after it forecast lower sales growth, but the S&P 500 was still on track to post a sixth straight month of gains.

Amazon.com Inc (NASDAQ:AMZN) sank 7.2%. Late on Thursday it reported revenue for the second quarter that was shy of analysts' average estimate and said sales growth would ease in the next few quarters as customers ventured more outside the home.

Shares of other internet and tech giants that did well during the lockdowns of last year, including Apple Inc (NASDAQ:AAPL), Google parent Alphabet (NASDAQ:GOOGL) Inc and Facebook Inc (NASDAQ:FB), were flat to lower.

"Overall earnings have been good. But Amazon ... and some of last year's winners are taking some of the air out of the market today," said Jake Dollarhide, chief executive officer of Longbow Asset Management in Tulsa, Oklahoma. "This market has been driven by big tech and when tech does well, the market seems to go right along with it, and when it doesn't," it falls.

Data on Friday showed U.S. consumer spending rose more than expected in June, although annual inflation accelerated further above the Federal Reserve's 2% target.

The Dow Jones Industrial Average fell 160.7 points, or 0.46%, to 34,923.83, the S&P 500 lost 23.31 points, or 0.53%, to 4,395.84 and the Nasdaq Composite dropped 106.08 points, or 0.72%, to 14,672.19.

Recent strong earnings and the continued rebound in the U.S. economy have helped to support stocks recently, but the rapid spread of the Delta variant and rising inflation have been concerns.

The S&P real estate index, generally considered a defensive play, hit an all-time intraday high.

Pampers maker Procter & Gamble (NYSE:PG) Co rose 2.1% as it forecast higher core earnings for this year, while U.S.-listed shares of Canada's Restaurant Brands International (NYSE:QSR) Inc jumped 5.0% after the Burger King owner beat estimates for quarterly profit.

Pinterest (NYSE:PINS) Inc, however, plunged 19.2% after saying U.S. user growth was decelerating as people who used the platform for crafts and DIY projects during the height of the pandemic were stepping out more.

Caterpillar Inc (NYSE:CAT) reversed course to fall 3.2%. The company posted a rise in second-quarter adjusted profit on the back of a recovery in global economic activity.

Overall, second-quarter results have come in from about half of the S&P 500 companies, of which nearly 91% have beaten profit estimates, according to Refinitiv data.