U.S. stock futures jumped sharply after the four largest tech companies beat earnings expectations. Microsoft and Meta Platforms (then Facebook) led the charge on this initiative. Microsoft shares jumped almost 7% after the company beat expectations in fiscal third-quarter results, thanks to a fearsome advance in its Azure cloud franchise. As a result, Meta Platforms increased its stock value by more than 5%. This massive increase came just after the company’s record earnings report—$6.43 per share, with $42.31 billion in revenue—well above the expectations of analysts.
Amazon’s share price jumped by over 2% following the announcement of a huge $4 billion investment. This funding will go toward improving its last-mile delivery capabilities in the nation’s smaller towns and cities. Tesla’s stock dropped over 3% in after hours trading on Robinhood. This downturn came on the heels of news that the board is seeking a new CEO to replace Elon Musk, raising concerns about the overall stability of the company’s leadership.
Also helping lift the overall market mood were Microsoft’s better-than-expected fiscal third-quarter results. The firm beat by a lot on both top and bottom lines, sending early shares up by over 6%. This performance was on the back of continued strength in its Azure cloud services, which have emerged as a key revenue engine for the company. Microsoft’s conservative guidance was praised by analysts who said it has restored investors’ faith.
Just this week, Meta Platforms caught a lot of attention with an audacious claim. They raised their full-year capex plans from a previous $64 billion to $72 billion. This change is meant to ensure that we can maintain the investments in data centers that are necessary for powering artificial intelligence and other innovative projects. The impact of this upward revision of capital expenditures further indicates that Meta is all-in on investing and expanding its technological infrastructure during a competitive landscape.
The rest of the market was extremely volatile, with the S&P 500 even entering bear market territory for a time before recovering some of those declines. This decrease came on the heels of more than a 20% drop from its peak in February. The Nasdaq Composite was up by 0.9% in overnight trading, a sign that tech stocks are getting more resilient.
Investors are getting ready for amazing good news this Thursday morning. Big market movers CVS Health, Eli Lilly & Co. and McDonald’s are all set to announce their quarterly results, along with some tech heavyweights like Apple and Amazon in the afternoon. These earnings reports are expected to give us even more clues about the state of the market and the corporate side of things in the coming weeks.
The Dow Jones Industrial Average added 138 points in early futures trading Wednesday. This was a big jump of 0.3% along with the whipsaw of recent history. The S&P 500 and the Dow returned today made money on. That’s all after they recovered from much larger declines earlier in what has otherwise been a highly turbulent trading day.
Skeptical market analysts are pondering just how much, if at all, political happenings should impact stock prices. According to UBS Global Wealth Management’s chief investment officer Solita Marcelli, the upcoming 100 days under President Trump’s administration could prove favorable for U.S. stocks as fiscal policy takes center stage.
“While market volatility may persist until more tariff certainty emerges, we think the sharpest Trump policy swings are likely behind us and that the outlook is becoming more constructive.” – Solita Marcelli
Moodys Capital Economics’ chief markets economist, John Higgins, wrote in agreement. What he’s focused most on is the direction of U.S. markets, which he thinks may continue to depend on how successfully they work through the current political environment.
“How things pan out over the next hundred days in the U.S. and elsewhere will partly hinge on whether U.S. markets (Treasuries in particular) and Corporate America continue to act as effective guardrails against Trump’s policies, as they appear to have done since April 2.” – John Higgins
The scramble from some investors and the caution from others further underscore the uncertainty pervading markets regarding economic policies and their impact on market stability. Analysts say strategies that directly address volatility should be the focus. They recognize the burden placed on them by shifting trade policies and political instability.
“[W]ith Trump’s first 100 days bringing political uncertainty, shifting trade policies, and choppy markets, we believe investors should focus on strategies that both manage and look through volatility.” – Solita Marcelli
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