Wall Street's main indexes fell on Friday, deepening a sell-off driven by tech stocks and mixed earnings, while investors assessed the impact of a global cyber outage that knocked down CrowdStrike's shares to an over two-month low.

Cyber security firm CrowdStrike slumped 11.2% after an update to one of its products appeared to trigger an outage that affected customers using Microsoft's Windows Operating System, disrupting businesses across sectors.

Major US airlines ordered ground stops citing communication issues, with the Euronext exchange and London Stock Exchange Group's Workspace news and data platform also facing issues. LSEG later said its data and services were back online.

Microsoft slipped 0.7% to an over one-month low, on track for a four-day decline, driven by a rout in tech stocks.

"Any hint of bad news, because they (tech stocks) are so priced to perfection is going to hurt these stocks, both (CrowdStrike and Microsoft) are excellent companies and are worthwhile long-term holds," said Phil Blancato, CEO of Ladenburg Thalmann Asset Management.

The disruption comes after two gruelling sessions for Wall Street, as investors assessed second-quarter earnings and a move away from megacaps that have primarily driven the equity rally in 2024.

Megacaps were largely mixed, with Nvidia and Amazon.com losing 1% and 0.5%, while Apple and Alphabet gained 1% each.

Chip stocks also struggled for direction. US-listed shares of Taiwan Semiconductor Manufacturing were down nearly 1.5%, while Arm Holdings jumped 3%.

Over the past two sessions, the Nasdaq has dropped 3.5% and the S&P 500 has fallen 2.1%, keeping the indexes on track for weekly losses.

Signalling investor unease, the VIX - Wall Street's "fear gauge" - was trading at its highest since early May.

Investors will also await comments from Federal Reserve officials John Williams and Raphael Bostic for hints on the policy path later in the day.

Markets have priced in a 25-basis-point interest-rate cut by September and expect two cuts by year-end according to LSEG data.

At 9:48am ET, the Dow Jones Industrial Average was down 179.14 points, or 0.44%, at 40,485.88, the S&P 500 was down 2.69 points, or 0.05%, at 5,541.90, and the Nasdaq Composite was down 18.08 points, or 0.10%, at 17,853.15.

Meanwhile, other cyber security shares rose, with Palo Alto Networks rising 1.5% and SentinelOne up 6.4%.

Eli Lilly jumped 2.6% after China approved its weight-loss drug tirzepatide, while Intuitive Surgical rose 8% after a second-quarter results beat.

That helped the S&P 500 healthcare index lead sectoral gainers.

Netflix fell 1% in choppy trading after the streaming giant cautioned third-quarter subscriber additions would be lower than a year earlier.

Oilfield services provider rose 1.3% after strong second-quarter profits.

S&P 500 companies that have reported second-quarter earnings to date recorded an 85% beat rate, with the growth rate standing at 11.1%.

Declining issues outnumbered advancers for a 1.40-to-1 ratio on the NYSE and for a 1.19-to-1 ratio on the Nasdaq.

The S&P index recorded 27 new 52-week highs and three new lows, while the Nasdaq recorded 16 new highs and 33 new lows.

  - Reuters