According to Blockworks: This week is pivotal for the stock market as major tech companies, including Alphabet, Microsoft, Meta, Apple, and Amazon, are scheduled to announce their earnings. Alphabet will lead on Tuesday, followed by Microsoft and Meta on Wednesday, and Apple and Amazon on Thursday. These five giants represent approximately 32% of the QQQ ETF's holdings, which has lagged behind the Nasdaq Composite recently, with a 1.8% return versus the Nasdaq’s 2.4%. A strong performance could lift QQQ out of its resistance zone and push broader market indices upward.
Broader Market Context: S&P 500 Earnings Season Update
Beyond these tech titans, 169 companies within the S&P 500 are set to report quarterly earnings this week, including industry leaders like Ford, Visa, Uber, Exxon, and Mastercard. According to FactSet, around one-third of S&P 500 companies have already disclosed earnings, with 75% beating earnings-per-share estimates and 59% surpassing revenue forecasts for Q3.
Analysts’ Outlook for Q3 and Q4 Earnings
Nicholas Colas, co-founder of DataTrek Research, notes that the Q3 earnings season shows modest improvement over recent quarters, albeit below long-term averages. Still, these earnings appear adequate to support current S&P 500 levels, providing a foundation for potential growth into Q4 and 2024. This week’s earnings from tech giants may determine whether the market experiences a strong close to Q3, setting the stage for year-end market trends.
Impact on Investors and Market Sentiment
Investors will be watching this earnings week closely, as positive results from leading companies could alleviate current resistance and inspire confidence across the tech and broader stock market.