Microsoft Shares Plunge, Dragging U.S. Stocks Lower

Microsoft Corp. (MSFT) shares plunged on January 29, 2026, triggering a broad selloff across U.S. equity markets as investors reacted to weaker-than-expected cloud revenue guidance. The tech giant fell over 8% in after-hours trading following its quarterly earnings release, which showed Azure growth slowing to 24% year-over-year — below consensus estimates of 27%. CEO Satya Nadella cited enterprise spending caution and elongated deal cycles. The Nasdaq Composite dropped 2.1%, while the S&P 500 shed 1.4% during regular session close. Analysts at J.P. Morgan downgraded MSFT to “Neutral,” citing margin pressure from AI infrastructure costs. Competitors Amazon (AMZN) and Google (GOOGL) also declined 3.2% and 2.8%, respectively, amid sector-wide contagion fears.