Snowflake leads software stocks higher as risk-on appetite returns
piranka

Snowflake (NYSE:SNOW) shares rose nearly 6% on Wednesday, leading cloud computing stocks higher as investors appeared to return to a risk-on sentiment after the month started in tepid fashion.
The Frank Slootman-led Snowflake (SNOW) tacked on 5.5% to $161.75, one day after investment firm BTIG downgraded the data warehousing company, noting a downtick in recent field checks. The cut was also the result of cloud hyperscalers such as Microsoft (NASDAQ:MSFT), Amazon (AMZN) and Google (GOOG) (GOOGL) seeing decelerating growth in the second quarter.
Analyst Gray Powell lowered his rating on Snowflake (SNOW) to neutral from buy, noting that customer spending intentions are still "solid," but not as good as they were six to twelve months ago. He added that some customers may be looking to shift spending to competitors, such as Databricks, to cut costs.
Datadog (NASDAQ:DDOG) shares rose nearly 5% as investors await the company's second-quarter results tomorrow.
A group of analysts expects Datadog (DDOG) to earn $0.15 per share on $381.28M, up 63.3% year-over-year. Datadog had previously guided sales to be between $376M and $380M, with non-GAAP operating income between $49M and $53M and non-GAAP earnings between $0.13 and $0.15 per share. 
Several other software stocks rose on Wednesday, including Microsoft (MSFT), Workday (NASDAQ:WDAY), Adobe (ADBE) and Intuit (INTU) all of which gained 1.5% or more.
Also seeing gains were monday.com (MNDY), Salesforce (CRM) and Oracle (ORCL), led by a 10% gain in monday.com.
Last month, investment firm Baird started coverage on Snowflake (SNOW), calling it a leader in "next-generation data."