MICROSOFT AND GOOGLE OUTLOOK:
- Microsoft and Google’s parent company Alphabet will announce quarterly results on Tuesday after the market close
- For GOOGL, investors forecast EPS of $25.63 on revenue of $68.13 billion. For MSFT, the consensus earnings estimate is $2.18 per share on revenue of $49.03 billion
- Microsoft and Alphabet’s quarterly performance and forward-looking commentary will be key for the tech sector and for the S&P 500[1] and the Nasdaq[2] 100
Most read: S&P 500, Nasdaq 100 Weekly Forecasts – Bond Yields Hammer Equity Sentiment[3]
Microsoft (MSFT) and Alphabet (GOOGL) will announce corporate earnings for the first three months of the year on Tuesday after the closing bell. These quality mega-cap companies have some of the largest weightings in both the S&P 500 and Nasdaq 100, so their stock performance can definitely set the tone for the broader market and skew near-term price action at the index level. For this reason, investors will be keeping a close eye on their quarterly results and, more importantly, their forward-guidance.
With the S&P 500 in correction territory and the Nasdaq 100 in a bear market, pressured by rising yields and fears that the U.S. economy is headed for a hard landing, Wall Street[4] desperately needs a reason to be optimistic about the outlook and start deploying capital into risk assets again. If Microsoft and Alphabet deliver robust numbers as in the previous quarter and issue constructive forward-looking commentary, relentless selling activity could start to abate, paving the way for the technology sector to stabilize. However, if these two heavy hitters disappoint and sound a note of caution about the future, as Netflix[5] did, all bets are off. In the lattercase, traders should brace for more pain and turbulence
