**A Pivotal Moment for Tech Titans**
Next week, the tech industry takes center stage as investors eagerly anticipate the earnings reports of the “Magnificent Seven” tech giants. Tesla, Meta Platforms, Alphabet (Google’s parent company), Microsoft, and others will release their financial results, offering insights into the health of the tech sector and the overall market.
With markets reeling from recent geopolitical tensions, rising interest rates, and Treasury yield spikes, the S&P 500 has fallen over 5% from its peak. Wall Street is pinning its hopes on these earnings reports to provide clarity and direction in the volatile market.
**Key Sub-themes to Watch**
Artificial Intelligence: Investors will be keen to assess how companies are monetizing artificial intelligence (AI), a rapidly growing field. Google’s cloud business and Microsoft’s Copilot chatbot are key areas to monitor for AI demand.
Consumer Sentiment: Companies like Visa will provide insights into consumer behavior amid inflationary pressures. Analysts are eager to see if consumer spending remains robust despite rising prices.
Earnings Outlook: Overall, the bar is high for the tech giants, but analysts expect solid earnings from Microsoft and Meta Platforms due to recent momentum in their businesses.
**Pivotal Earnings Align with a Market Crossroads**
“This is a pivotal earnings week that could potentially determine the market’s trajectory,” says Kim Forrest of Bokeh Capital. “Investors are looking to these results to gauge the market direction.”
However, Horizon Investments’ Scott Ladner urges caution, warning that high expectations could lead to a sell-off. He advises investors to use any dip as a buying opportunity, predicting a stronger stock market in the intermediate term.
“While expectations for AI are high, a potential sell-off due to unmet expectations could present a better buying opportunity,” says Ladner.
**A Broader Economic Snapshot**
In addition to tech earnings, next week will also bring the release of key economic indicators:
Gross Domestic Product (GDP): Economists predict a 3.1% growth in the first quarter, consistent with the previous quarter.
Personal Income and Consumption: These figures will provide insights into consumer spending, a crucial factor in the current economic landscape.
**The Week Ahead: Economic Calendar**
Monday, April 22
- Chicago Fed National Activity Index (March)
- Earnings: Verizon Communications, Ameriprise Financial, Truist Financial
Tuesday, April 23
- Building Permits final (March)
- PMI Composite preliminary (April)
- Markit PMI Manufacturing preliminary (April)
- Markit PMI Services preliminary (April)
- New Home Sales (March)
- Richmond Fed Index (April)
- Earnings: Baker Hughes, Visa, Enphase Energy, Tesla, NextEra Energy, Freeport-McMoRan, Philip Morris International, Halliburton, United Parcel Service, PepsiCo, Lockheed Martin, Raytheon Technologies, GE Aerospace
Wednesday, April 24
- Durable Orders preliminary (March)
- Earnings: Chipotle Mexican Grill, International Business Machines, Lam Research, Ford Motor, Align Technology, Waste Management, Universal Health Services, Raymond James Financial, Meta Platforms, Boeing, Hilton Worldwide Holdings, AT&T
Thursday, April 25
- Continuing Jobless Claims (04/13)
- GDP (Q1)
- Initial Claims (04/20)
- Wholesale Inventories preliminary (March)
- Pending Home Sales (March)
- Kansas City Fed Manufacturing Index (April)
- Earnings: T-Mobile US, Capital One Financial Corp, Intel, Western Digital, Microsoft, Alphabet, Comcast, American Airlines Group, Southwest Airlines, Valero Energy, Caterpillar, Tractor Supply, Royal Caribbean Group, PG&E, GE Vernova
Friday, April 26
- PCE Deflator
- Personal Consumption Expenditure
- Personal Income
- Michigan Sentiment NSA final
- Earnings: T. Rowe Price Group, Colgate-Palmolive, Exxon Mobil, Chevron, AbbVie, Phillips 66
Next week’s events promise to shed light on the health of the tech sector, consumer spending, and the broader economy. Investors are eagerly awaiting the earnings reports and economic data in anticipation of clearer market direction and guidance for the coming weeks.
Data sourced from: cnbc.com
