Will Earnings Cheer Continue To Buoy Markets? Apple, Amazon, Pfizer, Coinbase Lead Flurry Of Q1 Reports This Week

Corporate earnings came to the market’s rescue in the past week, helping to overcome rate fears. As we look ahead to the unfolding week, it remains to be seen whether the tech earnings deluge can keep the rally’s momentum going.

The Week That Was: High-profile Magnificent Seven earnings panned out mostly positively for the market, with Meta Platforms, Inc. META the outlier. The social media giant’s stock fell sharply as traders fretted over the soft second-quarter revenue guidance and the company’s massive AI investment plans.

Tesla, Inc. TSLA managed to appease the Street despite the double miss as it held out the promise of an expeditious launch of a more affordable EV.

With the earnings season now halfway through, the percentage of S&P 500 companies reporting positive earnings surprises and the magnitude of earnings surprises were above their 10-year averages, said FactSet in a report.

The blended first-quarter earnings growth of S&P 500 companies is estimated at 3.5%, up from the 0.6% growth estimated in the week ended April 19, the financial data analytics firm said. If the trend holds, the S&P 500 companies are on track to report earnings growth for the third straight quarter.

Of the 11 S&P sector classes, eight sectors reported year-over-year earnings growth, led by communication services, utilities, IT, and consumer discretionary sectors. On the other hand, healthcare, energy, and materials have reported year-over-year earnings declines.

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Look Ahead: The unfolding week will see 175 S&P 500 companies and 6 Dow 30 components releasing their quarterly scorecards. The earnings roster includes two Magnificent Seven companies, namely Apple, Inc. AAPL and Amazon, Inc. AMZN, e-commerce retailers, payment processors, restaurants, and energy and REIT companies.

Earnings from Apple and Amazon could be market-moving, given the weighting of these stocks in the S&P 500 Index. Also, Apple is considered a bellwether, given its exposure to consumers. Morgan Stanley’s Erik Woodring expects Apple to report a slightly beat but guide June quarter revenue down.

Investors are likely to keep a close eye on performance in China, Apple’s updated capital return framework, and capital expenditures, the analyst said.

That said, the analyst is positive on the stock ahead of its annual Worldwide Developers’ Conference due on June 10th. “With Apple’s biggest WWDC event on June 10th, we’d buy post-earnings weakness,” he said.

Amazon will likely continue to report double-digit sales and profit growth in the first quarter, according to Telsey Advisory Group analyst Joseph Feldman. The analyst premised his optimism on the strength of online spending, gains from expanded merchandise and faster fulfillment, and stabilization (and growth) of AWS.

“Importantly, we expect [a] greater focus on profits supported by the growth of higher margin categories and services, such as advertising, media, and AWS (partly helped by AI-related upgrades), the redesigned distribution network….. and cost savings,” he said.

Notable among the companies reporting earnings this week are:

Monday

• Before the bell: JinkoSolar Holding Co., Ltd. JKS, ON Semiconductor Corporation ON, Koninklijke Philips N.V. PHG, SoFi Technologies, Inc. SOFI
• After the close: F5, Inc. FFIV, Everest Group, Ltd. EG, NXP Semiconductors N.V. NXPI, Lattice Semiconductor Corporation LSCC, MicroStrategy Incorporated MSTR, Paramount Global PARA, Qiagen N.V. QGEN, Rambus Inc. RMBS, Sanmina Corporation SANM, Yum China Holdings, Inc. YUMC

Tuesday

• Before the bell: 3M Company MMM, Archer-Daniels-Midland Company ADM, The Coca-Cola Company KO, Eli Lilly and Company LLY, GE HealthCare Technologies Inc. GEHC, McDonald’s Corporation MCD, Molson Coors Beverage Company TAP, PayPal Holdings, Inc. PYPL, Tenet Healthcare Corporation THC
• After the close: Advanced Micro Devices, Inc. AMD, Amazon.com, Inc. AMZN, ONEOK, Inc. OKE, Pinterest, Inc. PINS, Starbucks Corporation SBUX, Skyworks Solutions, Inc. SWKS, Unum Group UNM. Super Micro Computer, Inc. SMCI, Stryker Corporation SYK, RenaissanceRe Holdings Ltd. RNR, Prudential Financial, Inc. PRU, Diamondback Energy, Inc. FANG, The Clorox Company CLX, Chesapeake Energy Corporation CHK

Wednesday

• Before the bell: Bausch + Lomb Corporation BLCO, CVS Health Corporation CVS, DuPont de Nemours, Inc. DD, The Estée Lauder Companies Inc. EL, Garmin Ltd. GRMN, GSK plc GSK, The Kraft Heinz Company KHC, KKR & Co. Inc. KKR, Logitech International S.A. LOGI, Mastercard Incorporated MA, Norwegian Cruise Line Holdings Ltd. NCLH, Pfizer, Inc. PFE, Wingstop Inc. WING, Yum! Brands, Inc. YUM
• After the close: Albemarle Corporation ALB, The Allstate Corporation ALL, Beazer Homes USA, Inc. BZH, C.H. Robinson Worldwide, Inc. CHRW, Devon Energy Corporation DVN, eBay Inc. EBAY, Etsy, Inc. ETSY, First Solar, Inc. FSLR, Freshworks Inc. FRSH, Kulicke and Soffa Industries, Inc. KLIC, Marathon Oil Corporation MRO, MetLife, Inc. MET, MGM Resorts International MGM, NETGEAR, Inc. NTGR, Qorvo, Inc. QRVO, Sunnova Energy International Inc. NOVA, Upwork Inc. UPWK, Wolfspeed, Inc. WOLF, Zillow Group, Inc. ZG

Thursday

• Before the bell: ArcelorMittal S.A. MT, ConocoPhillips COP, CyberArk Software Ltd. CYBR, Ferrari N.V. RACE, Intercontinental Exchange, Inc. ICE, Kimco Realty Corporation KIM, Moderna, Inc. MRNA, PENN Entertainment, Inc. PENN, Wayfair Inc. W, Zoetis Inc. ZTS
• After the close: Amgen, Inc. AMGN, Apple, Inc. AAPL, BigBear.ai Holdings, Inc. BBAI, BJ’s Restaurants, Inc. BJRI, Booking Holdings Inc. BKNG, Cloudflare, Inc. NET, Coinbase Global, Inc. COIN, Consolidated Edison, Inc. ED, DraftKings Inc. DKNG, Five9, Inc. FIVN, Expedia Group, Inc. EXPE, Illumina, Inc. ILMN, Live Nation Entertainment, Inc. LYV, United States Steel Corporation X, Regency Centers Corporation REG, Reinsurance Group of America, Incorporated RGA, Pioneer Natural Resources Company PXD, Opendoor Technologies Inc. OPEN, Monster Beverage Corporation MNST

Friday

• Before the bell: American Axle & Manufacturing Holdings, Inc. AXL, Cboe Global Markets, Inc. CBOE, Fluor Corporation FLR, The Hershey Company HSY, Owens & Minor, Inc. OMI, XPO, Inc. XPO

The SPDR S&P 500 ETF Trust SPY, an exchange-traded fund that tracks the performance of the broader S&P 500 Index, ended Friday’s session up 0.95% at $508.26, according to Benzinga Pro data. The ETF has pulled back from its all-time high (intraday) of $524.61 hit on March 28. The Invesco QQQ Trust QQQ, an ETF levered more to high-profile, non-financial tech stocks, rose 1.54% to $431.

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