This Week, Tech Giants Kick Off a Profit Bonanza
Investors are focusing on an important earnings week as major tech companies prepare to announce their financial results. Alphabet Inc. (NASDAQ:GOOGL), Google's parent company, will report its earnings later today, marking the beginning of a series of reports from the "Fabulous 7" tech giants that have propelled Wall Street to new heights this year.
Following Alphabet, Meta Platforms Inc. (NASDAQ:META) and Microsoft Corp. (NASDAQ:MSFT) are expected to release their results on Wednesday, while Amazon.com Inc. (NASDAQ:AMZN) and Apple Inc. (NASDAQ:AAPL) will wrap up the week on Thursday.
Last week, Tesla Inc. (NASDAQ:TSLA) set a high bar with optimistic sales forecasts, leading to a 22% surge in its stock value—the largest rally the company has seen in a decade. However, some analysts remain cautious due to CEO Elon Musk's history of ambitious promises.
Nvidia Corp. (NASDAQ:NVDA), which often stands out for its artificial intelligence capabilities, is also gaining attention as it competes with Apple for the title of the most valuable company. However, Nvidia’s financial results will not be reported until later in November.
In the semiconductor sector, Advanced Micro Devices Inc. (NASDAQ:AMD) will announce its earnings today, followed by Intel Corp. (NASDAQ:INTC) on Thursday. These reports are expected to provide insights into the ongoing demand for artificial intelligence technology.
European banks are also in focus. HSBC Holdings plc announced a $3 billion share buyback and a 10% increase in profits today. Last week, HSBC had been in the news due to a major restructuring and the establishment of a leaner board. Banco Santander S.A. (BME:BME:SAN) is also reporting its earnings today; however, the UK division delayed its announcement due to a recent court ruling regarding motor financing commissions. UBS Group AG will report its earnings on Wednesday.
As the European Central Bank leads interest rate cuts among major global competitors, the health of the banking sector is under scrutiny, and investors are seeking confidence in the long-term earnings of banks.
In contrast, the U.S. Federal Reserve enjoys the luxury of a more measured approach to policy changes, supported by strong economic indicators particularly in the labor market. Today's job openings data for September, measured by JOLTS, is particularly significant as it is one of the Fed's preferred metrics. The market is also preparing for monthly employment data to be released on Friday, which will set the stage for the Fed’s policy decision on November 7. During this period, Fed officials have entered a blackout period and are not providing new guidance.
In addition to mixed market influences, the upcoming U.S. presidential election on November 5 is shaping up to be a significant event. Current polls indicate a tight race, while some market trends and betting platforms suggest an increasing expectation of a Republican victory. This political uncertainty is already affecting business decisions, as noted in a recently released Dallas Fed manufacturing report; companies are reporting that they are postponing major deals until the election outcome is clearer.
Today's market movements may be influenced by the earnings reports of HSBC and Santander in Europe, as well as Alphabet and AMD in the U.S., alongside the JOLTS data and October consumer confidence figures.