Global stocks down ahead of earnings results

Wall Street stocks ended a choppy session slightly down as investors assessed mixed earnings reports, while Europe's main stock markets were mixed after Asia's major indices closed lower

Global stock markets closed mostly lower Tuesday ahead of company earnings, following a strong start to a week amid US presidential race.

Wall Street stocks ended a choppy session slightly down as investors assessed mixed earnings reports, while Europe's main stock markets were mixed after Asia's major indices closed lower.

It is a mixed picture, LPL Financial's Quincy Krosby told AFP. And when you are in a slowing environment, you are going to get a mixed picture.

Joe Biden's decision to end his reelection bid and endorse Vice President Kamala Harris had little major impact on sentiment, analysts said.

Politics could be less of a driver for markets for the rest of the summer now that the Democrats are back in the race, said Kathleen Brooks, research director at XTB.

Harris and Trump "are known quantities, so whoever wins the race for the White House, the market, in some ways, knows what to expect", she added.

Focus turned to corporate earnings, with Google parent Alphabet and electric carmaker Tesla both reporting results after Wall Street closed on Tuesday.

In its earnings, Tesla reported a sharp decline in second-quarter profits due to the effect of price cuts, while Alphabet beat revenue and profit expectations as its cloud and search ads businesses thrived.

Tesla's shares dropped nearly 2% in after-hours trading Tuesday, while Alphabet jumped more than 1%.

The two tech companies are part of the "Magnificent Seven" group of companies that have driven a rally that pushed all three main New York indices to new records this year, thanks also to expectations that the US Fed will soon reduce borrowing costs.

But the news has been less positive this month, with the Magnificent Seven experiencing "a sharp decline in total return," according to market analyst Fawad Razaqzada at City Index and FOREX.com.

In Europe, Swedish music streaming giant Spotify reported a 12% rise in subscribers to 246 million in the second quarter, beating estimates, along with a 266-million-euro operating profit. Its shares rose more than 12%.