These 2 FAANG Stocks Were in the Spotlight Tuesday

Tuesday was a mixed bag for investors on Wall Street, as gains for the Dow Jones Industrial Average (^DJI 0.63%) stood in contrast to losses for the Nasdaq Composite (^IXIC 2.29%) and S&P 500 (^GSPC 1.29%). Market participants reacted to some interesting earnings releases from the premarket session and also were waiting for more results due after the closing bell.

Data source: Yahoo! Finance.

Big companies haven't been able to avoid the wrath of the bear market recently, and even FAANG stocks have proven vulnerable to macroeconomic pressures. On Tuesday, investors in Amazon.com (AMZN 3.56%) and Alphabet (GOOGL 10.53%) (GOOG 10.21%) learned of some news that could affect the business models for both companies going forward. Read on to see why these two stocks eased lower on Tuesday and whether they're bound to rebound as 2023 progresses.

Amazon introduces subscription pharmaceutical services

Shares of Amazon.com finished lower by 1.2% on Tuesday, underperforming the broader market. Yet the e-commerce giant announced a new initiative that's intended to help it make a more extensive entry into the healthcare market.

Amazon introduced its new RxPass service, which allows members of the Amazon Prime subscription service to obtain one or more eligible generic medications for a single $5 per-month fee. Included in the service is free delivery to subscribers' homes on a monthly or quarterly basis, eliminating the hassle of visiting pharmacies and waiting for prescriptions to be ready. Among eligible  pharmaceuticals are those treating conditions like high blood pressure, high cholesterol, diabetes, allergies, and certain mental health ailments.

Amazon sees RxPass as eliminating the need for users to access their health insurance with respect to the drugs that are eligible for the plan. Yet the company did stress that the Amazon Pharmacy unit does accept most insurance plans for other medication needs.

Even though Amazon stock didn't react positively to the news, competitors felt the impact as GoodRx Holdings (GDRX 1.57%) fell more than 7% on the day. Amazon has had healthcare aspirations for a long time, and this marks just the latest in what could be a long-term foray into the space.

Alphabet deals with more antitrust controversy

Elsewhere, shares of Alphabet finished lower by 2%. The Google parent is facing more allegations from regulators that it has engaged in illegal anti-competitive practices.

The U.S. Department of Justice joined with attorneys general in eight states in filing a civil antitrust lawsuit against Alphabet's Google unit. The suit alleges that Google has spent the past 15 years looking to cement monopoly status in digital-advertising technology, whether through acquisitions of potential competitors or using market power to force publishers and advertisers to use its ad-tech products. The net result, according to the Justice Department, was dominance in ad tools as well as Google's digital-advertising and ad-auction exchange.

Google has faced antitrust allegations before in a number of jurisdictions. However, the Justice Department was clear to emphasize that this is the first monopoly case in roughly 50 years in which the U.S. government has sought triple damages for the losses that it claims various federal government agencies incurred from overpaying for web-display advertising.

Some investors believe that they might actually be better off if Alphabet broke up its empire into multiple pieces, as the parts might be more valuable than the whole company. For today, though, investors seemed more cautious about the long-term impact the suit could have on Alphabet's business prospects.