Big tech could put a damper on stocks Wednesday, after earnings took an ugly turn late Tuesday.
Apple's stock was crushed after the closing bell, when it reported a softer revenue outlook and earnings that beat but failed to excite investors. Microsoft shares slipped more than 3 percent in late trading, after it posted a $3.2 billion net loss when including restructuring charges. But Microsoft also beat on the top and bottom line when excluding the charges.
"Coming into Apple's numbers, people were talking about the breadth of the market and how leadership narrowed. So now, to take away one of the leaders, there are not so many things for bulls to hang their hats on," said Scott Redler, partner at T3Live.com. Apple dropped nearly 8 percent in after-hours trading, falling to the $121 level and now traders are watching to see if it holds its 200-day moving average at around $119.