Tech Stocks Rebound as Investors Digest Earnings Reports
The Nasdaq Composite and S&P 500 indices are on the path to recovery, driven by the release of megacap tech earnings and anticipation of Apple’s quarterly results. The tech-heavy Nasdaq Composite rose slightly, while the S&P 500 moved up 0.3%. The Dow Jones Industrial Average also saw a 0.2% increase, following a losing day on Wall Street.
Earnings Season in Full Swing
Investors are closely examining earnings reports, particularly from the “Magnificent Seven” companies that have driven broader stock market gains. Microsoft, Meta, and Tesla have already released their quarterly results, with Apple’s report expected after the bell. The focus is on the companies’ rationale for massive AI investments, especially after DeepSeek’s cheaper AI model raised questions about the likelihood of a payoff.
Tesla Defies Expectations
Despite an earnings miss, Tesla shares surged as investors took the company’s vow to return to growth in 2025 at face value. Meanwhile, Meta’s quarterly earnings beat lifted its shares in pre-market trading, but Microsoft’s stock slid after its cloud revenue fell short.
Economic Data Released
The Bureau of Economic Analysis’s advance estimate of fourth-quarter gross domestic product (GDP) showed the US economy grew at an annualized pace of 2.3%, below the 2.6% expected by economists surveyed by Bloomberg. The reading compares with the 3.1% seen in the third quarter.
American Airlines Crash
A fatal collision between an American Airlines passenger jet and a US army helicopter dominated headlines. The crash occurred in midair as the plane approached Reagan Washington National Airport on Wednesday night, resulting in no survivors.
Oracle Unveils AI Agents
Oracle debuted its latest AI agents aimed at manufacturers during its CloudWorld event in Austin on Thursday. The agents are designed to help supply-chain workers across a host of jobs, ranging from procurement to sustainability. AI agents are specialized AI bots that can take actions on a user’s behalf, either autonomously or with their oversight, across multiple apps.
Earnings Reports Ahead
Several major companies are set to release their quarterly earnings reports, including Intel, Comcast, Mastercard, Visa, and more. Investors will be scrutinizing these reports for signs of growth and guidance on the companies’ prospects.
Market Outlook
As the Federal Reserve stood pat on interest rates, investors are turning their attention to earnings reports and economic data for clues on the market’s direction. With the US economy growing at a slower-than-expected pace, investors are cautious about the topic of inflation. However, the rebound in tech stocks suggests that investors are still optimistic about the prospects of Big Tech.
Leave a Reply