By Yasin Ebrahim

Investing.com — The S&P 500 moved off session lows Tuesday, but remained under pressure from a slump in social media stocks after Snap warned on profit amid a deteriorating economic backdrop.

They fell by 1.3% and slipped 0.3% (109 points), respectively. The was 2.7% lower.

Snap (NYSE:) fell more than 40% after the social media company cut its guidance on revenue and profitability, citing a faster-than-anticipated deterioration of the macroeconomic environment.

The warning from SNAP “will sound the alarms on the deteriorating macro’s evolving effects on digital advertising,” RBC said in a note after slashing its price target on the stock to $17 from $25.

Fears of a lower backdrop for advertising spending caused shockwaves across social media stocks. Meta Platforms (NASDAQ 🙂 declined more than 9. Twitter (NYSE 🙂 lost more than 5.5% while Pinterest (NYSE 🙂 fell 23%

Zoom Video Communications (NASDAQ): In contrast, after software company reports better-than expected, it opted to sell and raised its annual guidance. It sent shares higher than 6%.

Companies continued to raise concerns about inflation and the outlook for growth elsewhere on earnings.

Abercrombie & Fitch (NYSE:) plunged more than 30% as the retailer cut its sales outlook for the year after reporting a surprise loss owing to rising transportation and product costs.

AutoZone’s (NYSE:) shares rose by more than 4 percent after better-than-expected quarter-end results.

Data showing that the market for homebuilders fell to its lowest level since April 2020 was a sign of pressure. Mortgages are at their highest since 2009.

“The Federal Reserve is pumping the brakes; the most interest-rate sensitive sectors, notably housing, are cooling,” Grant Thornton said in a note.

Toll Brothers (NYSE:) – The market closes on Tuesday and reports quarterly results. It fell by more than 4% Lennar (NYSE:) and KB Home (NYSE:) were also in the red.