Equities and US stocks dropped sharply on Tuesday as stocks from tech giants, such as Apple and Microsoft, fell ahead of post-market earnings reports.

Nasdaq 100 saw its biggest one-day drop in more than two months, when all three major US indices tumbled from record highs. Shares of Tesla declined, while shares of General Electric rose, after both published results that beat analysts' estimates.

At the same time, the debacle in China heightens global concerns as investors remain worried about the economic recovery, given the rise in COVID-19 cases due to the delta variant of the virus and talks of tighter monetary policies. A strong start to earnings season helped US stocks rally earlier, but further movement will now depend on the actions of the Federal Reserve and the reports from Apple, Microsoft and Alphabet.

Chris Murphy, a chief strategist at Susquehanna International, said the tech stock turmoil in China is spilling over into US, so many investors may gain profit ahead of big tech returns later this week. However, the market may calm down amid a seasonally weak period for equities.

In any case, forecasts show that S&P 500 still has a chance to hit new all-time highs, thanks to better-than-expected earnings reports from more than 80% of companies listed in the index.

Other important events for this week are:

- FOMC meeting (Wednesday);

- report on oil stocks (Wednesday);

- policy decision of the Federal Reserve (Wednesday);

- unemployment report in Germany (thursday);

- data on US GDP (Thursday).

- GDP and CPI report from Germany (Friday);

- Alphabet, Apple, Facebook and Amazon earnings reports.