Microsoft Corp (NASDAQ:MSFT) shares are trading lower on Tuesday alongside several software companies.
The stock is facing selling pressure following a Bloomberg report indicating that the company cut some of its workforce as part of a structural adjustment. The layoffs will reportedly affect less than 1% of Microsoft’s 180,000 employees.
Morgan Stanley analyst Keith Weiss maintained Microsoft with an Overweight rating and lowered the price target from $372 to $354 on Tuesday.
Shares of companies in the broader software sector are also under pressure amid economic uncertainty and Fed policy tightening measures, which have weighed on growth stocks.
The Federal Reserve has embarked on what is expected to be its most aggressive tightening cycle in more than 40 years as the central bank attempts to tame rising inflation. Higher rates decrease the present value of future cash flows, which can negatively impact the valuations of growth stocks.
The consumer price index data for June is scheduled to be released on Wednesday. Several economists expect another strong inflation print. Consensus estimates point to CPI levels nearing 9% in June, which would be another tick up from the 8.6% reading in May.
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MSFT Price Action: Microsoft has traded as high as $349.67 and as low as $241.51 over a 52-week period.
The stock was down 3.61% at $254.92 at press time, according to data from Benzinga Pro.
Photo: courtesy of Microsoft.
