Google agreed to acquired cloud security startup Wiz for $32 billion.
But Alphabet shares declined as much as 5% as investors instead focused on the economy.
Slowdown worries have come to a head in recent weeks, with some bracing for recession.
Investors have met Google’s $32 billion acquisition of cloud security startup Wiz with a collective yawn.
Shares of parent-company Alphabet dropped as much as 5% on Tuesday following the deal announcement.
The deal is seen as an attempt by Google to close the gap between itself and mega-cap cloud competitors like Amazon and Microsoft. But rather than react to a potentially transformative deal, investors elected to focus on economic-slowdown fears.
These concerns stem largely from President Donald Trump’s ongoing trade war, with uncertainty around tariffs clouding forecasts for corporate activity and economic expansion. Rumblings of a possible recession have gotten louder, leading to risk-off sentiment that recently pushed the benchmark S&P 500 into correction territory.
Alphabet’s share decline comes alongside a sell-off for the so-called Magnificent Seven. Tesla fell 5% to pace the group’s losses, while Meta fell 4%. The tech-heavy Nasdaq Composite slid 1.8%.
Investors will be watching the Federal Reserve’s upcoming policy meeting to determine how the central bank feels about the state of the economy. Virtually no investors expect an interest-rate cut at this meeting, though this could become a possibility down the road if the economic stimulus is needed.
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