Key international financial events this week include: Earnings Reports from Tech Giants Like Apple, Microsoft and Alphabet, European and Japanese Central Bank Interest Rate Decisions, Purchasing Managers Index (PMI) of Major Economies, Gross Domestic Product US (GDP) Consumer Spending Price Index (PCE), Michigan Consumer Confidence Index and House Price Index and other economic data.
Trading Notes This Week (1024-1028)
1. Earnings from High Tech Stocks
US stocks entered super earnings week this week, including Apple, Microsoft, Alphabet, Amazon and Meta, which representS&P 500 IndexThe weight is about 20%,Nasdaq Composite IndexEarnings reports from heavy tech stocks weighing more than a third will be released this week.If US stocks can continue to rebound last week, these companies’ performance and prospects are very important.
The IBES Refinitiv data show that,S&P 500 IndexCorporate profits in the third quarter are estimated to have increased 3.1% year on year, the worst performance in more than two years, and the next year’s earnings growth rate fell to 7.2% from a forecast 7.8% at the beginning of the year.
Among the tech giants, only Apple outperformed this year, with the iPhone maker accounting for 7% of the S&P 500, down about 17% so far this year. Microsoft and Amazon both fell around 28%, while Alphabet fell 30%, both lagging behind the S&P 500’s 21% drop.
Investors tend to be drawn to Big Tech’s financial strength and competitive advantages, believing it can perform well in an uncertain economic environment, but Refinitiv data shows that of the Big Tech companies, only Apple has made profits and been profitable in the United States. The past two quarters, revenues have been better than expected and the remaining companies have struggled in key areas such as Microsoft’s personal computer (PC), Alphabet’s ad spend, and Amazon’s consumer purchasing power.
Rising US Treasury yields also weighed on technology valuations, as higher yields could weigh heavily on companies’ expected earnings going forward. 10-Year Treasury YieldLast week it rose to a 14-year high.
Gain of the apple
Global market capitalization leader Apple is expected to announce its new quarterly earnings on Friday (28) Taiwan time. In addition to paying attention to the impact of economic headwinds on demand, the market will also be watching the impact of a stronger dollar on sales.
The recent news that Apple has cut orders for the iPhone 14 Plus has raised concerns about slowing demand for high-end models. Foreign media “The Information” quoted people familiar with the matter as saying last week that Apple asked more than one Chinese manufacturer to stop manufacturing parts for the iPhone 14 Plus.
Additionally, Bloomberg reported in September that weaker-than-expected demand led Apple to abandon its iPhone 14 production increase plan, while maintaining its iPhone 14 production target of 90 million units by the end of the year. .
Analysts tracked by FactSet expect Apple’s fourth quarter revenue to rise 6% to $ 88.7 billion and earnings per share (EPS) to rise 2.4% to $ 1.27.
Looking at the product mix, analysts expect iPhone revenue to increase 12% year-on-year to $ 43.4 billion, iPad and Mac revenue is expected to decline from the same period last year, to $ 7, respectively. 7 billion and $ 9 billion, Apple Watch and Revenues from other wearable devices, smart home and accessories are estimated to have increased 1% to $ 8.9 billion and it is worth noting that analysts predict that the revenues of the services in the last quarter will exceed $ 20 billion for the first time.
European and Japanese central bank interest rate decisions
EURThe regional inflation rate unexpectedly rose to 10% last month, sparking expectations for the European Central Bank (ECB) to raise interest rates again, and Thursday’s interest rate meeting is expected to rise another 3 yards.
considerEURThe region is heavily dependent on imported energy,EURDevaluation threatens to make electricity more expensive, fueling inflation and undermining economic growth, markets see central bank governor Christine Lagarde defend a possible hawkish tone at this meetingEUR。
On the other hand, the Bank of Japan (BOJ, Bank of Japan) is expected to keep its ultra-easy monetary policy unchanged, with wage growth and inflation expectations still contained even though Japan’s inflation rate has reached 3%. which supports the BOJ trend as current inflation is supply-side driven and will subside soon.Bank of Japan is following an ultra-loose policy, which has led toJPYThis year it has lost about 30% of its value against the dollar.
This week, in addition to the central banks of Europe and Japan, the central banks of Canada and Brazil will also announce interest rate decisions.The market expects the central bank of Canada to raise interest rates 2-3 yards below the continuing high. inflation and the central bank of Brazil is expected to keep interest rates unchanged.
