US Earnings Week Ahead

Earnings season heats up this week as tech heavyweights release earnings including, Apple, Amazon, Alphabet, and Meta.

Update 7 February 2023

With January coming to a close, market participants went into the second month of 2023 with all eyes on the U.S earnings season with tech heavyweights Meta (NASDAQ: META), Apple (NASDAQ: AAPL), Alphabet (NASDAQ: GOOGL), and Amazon (AMZN) releasing their latest quarterly earnings results. Despite a jam-packed earnings calendar, market participants were also occupied with the latest FED interest rate announcement and the most recent Non-Farm Payrolls (NFP) data report for January 2023.

Mark Zuckerberg’s multinational technology conglomerate, Meta (NASDAQ: META), saw its share price surge as bullish sentiment entered the market amidst better-than-expected sales, an announced $40 billion share buyback and Zuckerberg’s promise to deliver a “year of efficiency” to investors. Closing at $153.12 on Wednesday, Meta gapped 20% higher in extended trading to open at $183.38 on Thursday, 2nd February, closing at $188.77, representing a near 24% share price increase from the prior day’s close. Despite missing earnings expectations with a reported $1.76 EPS figure coming in against expectations of $2.23, market sentiment turned bullish as Zuckerberg sets goals for Meta to become “a leader in generative artificial intelligence”.

Technology kingpin, Apple (NASDAQ: AAPL) reported a rare miss in their latest quarterly earnings expectations, with EPS coming in at $1.88 against expectations of $1.94. Despite this, bullish sentiment has carried the share price to its highest level since November 2022, with reports that Apple now has a stellar 2 billion active devices and expects the improving macroeconomic environment to boost sales. Similarly, Alphabet (NASDAQ: GOOGL) fell short of earnings expectations, reporting an EPS figure of $1.05 against expectations of $1.20. Closing at $100.43 on Wednesday, Alphabet saw its share price gap higher to open at $105.80 on Thursday, closing at $107.74, 7.28 percent higher from the prior day’s close. However, disappointing earnings results have seen the price trend decrease with GOOGL closing at $102.90 on Monday, 6th of February. Amazon (NASDAQ: AMZN) saw its share price gap higher on Thursday, closing 7.38 percent higher compared to Wednesday’s close, but disappointing earnings results with an 82.60 percent EPS miss saw bearish sentiment drag Amazon’s share price down to close at $102.18 on Monday, 6th of February.

Market participants were kept busy as the Federal Reserve announced a 25-basis point rate hike with Jerome Powell maintaining his hawkish stance, providing little to no indication that the FED is “nearing the end of [its] hiking cycle”, stating that “inflation has somewhat eased but remains elevated”. Despite annual U.S CPI declining for the sixth consecutive month in December to 6.5%, the FED believes that “substantially more evidence” is required before inflation is believed to be “on a sustained downward path”.

Closing off the first week of February, U.S Non-Farm Payrolls gained massively with a much higher-than-expected 517 000 jobs added to the U.S economy in January 2023, significantly exceeding expectations of 188 000. Additionally, a lower-than-anticipated 3.4% unemployment rate for January, down from 3.5% in December, has seen the U.S Dollar trend higher against other major currencies.

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