Top 5 Issues for Stock Exchanges and Other Financial Markets This Week by

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Written by Norin Burke – Investors will watch the flow of profits over the next week, including reports from technology titans Apple, Microsoft, Amazon and parent company Alphabet Google in the hope that high corporate profits will support US stock markets that shook the Federal Reserve. Meanwhile, the United States and the eurozone are expected to release preliminary growth data for the first quarter, as well as inflation data, which will be closely monitored. Here’s what you need to know to start your week.

The results of large technology companies

Nearly 180 listed companies, which is about half the market value of the benchmark, are expected to report results within the next week, including the four largest US companies by market capitalization: Apple (NASDAQ :), Microsoft (NASDAQ :), Amazon. (NASDAQ 🙂 and Alphabet, the parent company of Google (NASDAQ :).

All four stocks have fallen since the beginning of the year, losing about 9% for, 13% for, 17% for and 18% for.

Earnings expectations in the first quarter were subdued, and shares of Netflix (NASDAQ 🙂 fell after the streaming giant announced a reduction in subscribers, raising concerns about the future results of technology companies.

“Expectations are low, but that doesn’t mean it doesn’t matter,” James Ragan, DA Davidson’s director of wealth management research, told Reuters. “If we are going to achieve this 9% (revenue growth) in a year or even better, it is difficult to imagine that we will achieve this without having better-than-expected profits from mega-limits.”

Other big names that reported results during the week included owners of Facebook Meta Platforms (NASDAQ :), payment companies Visa (NYSE 🙂 and Mastercard (NYSE:), oil companies. Chevron (NYSE 🙂 and Exxon Mobile (NYSE :), and Coca-Cola Consumer Companies (NYSE 🙂 and Pepsico (NASDAQ :).

US economic data

In addition to earnings data, this week will focus on US economic growth and inflation amid speculation about whether the Fed will be able to provide a soft fit for the economy by taking decisive action to curb rapid inflation.

The United States released preliminary growth data for the first quarter on Thursday, which is expected to slow sharply to 1.1% from 6.9% in the last quarter of 2021 due to the impact of the Omicron pandemic wave earlier this year.

The day after GDP data will be an index that is considered desirable for the Fed inflation.

Last week, Fed Chairman Jerome Powell said a half-point raise would “be on the table” during a central bank meeting on May 3-4, adding that investors expecting a series of half-point increases “generally responded appropriately.” “, To the new Fed’s fight against inflation.

These comments seem to confirm a much steeper trajectory of the expected rate than predicted at the last meeting of the Fed in March.

The economic calendar also includes updates from,,,,, {{ecl-38 || Chicago IPM} and.

Stock market volatility

All three major Wall Street indicators ended the week in negative territory on Friday, the third consecutive week of losses for the S&P 500 and, while the index recorded its fourth weekly decline in a row.

The Dow’s fall of 2.82% on Friday was the biggest one-day fall since October 2020.

Recently, exaggerated fluctuations in trade have become more common as traders adjust to new earnings data and amid concerns about the risks of a more aggressive Fed rate hike.

The volatility index, also known as the Wall Street Fear, rose to its highest level since mid-March on Friday.

“Since I’ve been doing this, the market has rarely moved 2% in one direction or another, and we say to ourselves, ‘There’s not much to read,'” Craig Earlam, senior, told Reuters by market analyst OANDA.

“It’s abnormal, but it’s been so long.”

Eurozone data

The eurozone is expected to release data for the first quarter on Friday, as well as preliminary data on consumer price inflation in April, which is expected to be at a level almost four times higher than the European Central Bank’s target of 2%.

Last week, ECB President Christine Lagarde said the bank was likely to suspend its bond-buying program early in the third quarter and raise rates by the end of the year to fight rising inflation.

But the war in Ukraine obscures the ECB’s picture, with high energy prices and supply disruptions caused by the pandemic and exacerbated by the war hampering growth.

European results

European profits will start in earnest next week, and although companies were expected to face higher inflation in the first quarter, investors will focus on their forecasts for the rest of the year.

More than 140 companies are expected to report results during the week, including the consumer goods giant Unilever PLC (LON :), manufacturer Nivea Beiersdorf (ETR:), as well as the largest banks UBS Group (SIX :), Deutsche Bank (ETR :), HSBC (LON 🙂 and Barclays (LON :).

Casper Elmgreen, head of Amundi’s stock division, expects first-quarter results to be “decent”, but focuses on price pressures and uncertainties caused by the crisis in Ukraine.

“It’s extremely, very important for us to understand how companies can pass on spending to consumers,” Elmgreen told Reuters.

“What will they say about pricing? What will they say about volumes? What about mixed margins? And can they say something about demand prospects?” he added.

– Reuters has joined this report

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