The Dow managed to make progress through the past week, unlike the Nasdaq and S&P 500, logging a fourth straight weekly advance. As the market heads into August, the Dow is up 3.8% so far in July, vs. declines for both the S&P 500 and the Nasdaq. And another slug of earnings from Dow Jones names are on tap in the coming week.
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These Magnificent Seven Stocks Have Earnings Due As Techs Sell Off
Apple (AAPL) and Microsoft (MSFT) top the docket. Boeing (BA) and McDonald’s (MCD) are also on the list, along with Dow Jones stocks Intel (INTC), Pfizer (PFE), Merck (MRK) and Procter & Gamble (PG). Only Merck is expected to see an earnings jump. Beyond the Dow Jones stocks, Amazon.com (AZMN) and Meta Platforms (META) also report. And maybe some of the week’s biggest news won’t come from earnings, but from the Federal Reserve meeting and its midweek policy announcement, or from the Labor Department’s July payrolls report on Friday.
Five Stocks Past Earnings, Near Buy Points
The market remains in flux in the heart of earnings season, but several stocks are in or near buy zones, including GE Aerospace (GE), Toll Brothers (TOL), Spotify (SPOT), Dow Jones stock JPMorgan Chase (JPM) and Tenet Healthcare (THC). Four of these stocks have recently reported results, so that risk is out of the way. For the fifth, luxury homebuilder Toll Brothers, earnings are still three weeks away. GE briefly broke out Tuesday on earnings, and is rebounding after a test of support. Toll Brothers is in a buy zone after a three-week advance. Spotify has pulled back below a buy point after gapping up on earnings. JPMorgan and Tenet Healthcare are both in buy zones.
Economic Calendar: A Rate-Cut Cycle Grows Near
A year after the Federal Reserve’s last interest rate hike, the policy statement out Wednesday is expected to signal a pivot to rate-cutting in September. A deliberate pace of cuts is likely after GDP growth accelerated in Q2 as core inflation progress stalled. A further softening of the labor market could spur the Fed to cut faster. So the July jobs report on Friday might be a market mover if forecasts are off the mark. Economists expect a 180,000 payroll gain, including 160,000 private-sector jobs, according to the FactSet consensus. The unemployment rate is seen holding at 4.1%. The Employment Cost Index, the Fed’s favorite measure of wage growth, is out Wednesday.
Fed Inflation Rate Stalls, September Rate Cut On Track; S&P 500 Rallies
Dow Jones Leader: Apple’s iPhone 16 Outlook Key
Apple analysts are braced for soft iPhone sales when the Dow Jones component reports fiscal third-quarter results late Thursday. But the focus will be on guidance for the current fiscal fourth quarter, which will see the launch of Apple’s AI-enabled iPhone 16 series handsets. For the June quarter, analysts expect Apple to earn $1.34 a share, up 6% year over year, on sales of $84.2 billion, up 3%. Earnings and revenue growth are expected to improve mildly in the coming year. Apple stock spiked to a record high in mid-July on enthusiasm for an AI-driven hardware upgrade cycle. Analysts expect Apple to announce its iPhone 16 lineup in September.
Apple Stock Seen Rising On AI Replacement Cycle
Artificial Intelligence: Microsoft Sales Seen Up 15%
Software kingpin Microsoft reports fiscal Q4 results late Tuesday. Analysts expect earnings of $2.94 a share, up 9%, on sales of $64.4 billion, up 15%. Wall Street will be looking for continued strength in Microsoft’s Azure cloud infrastructure business. They also want to see progress in monetizing its artificial intelligence investments with its Copilot services. Analysts also will scrutinize the Dow Jones component’s capital expenditures amid heightened spending on data center and AI capacity.
Social Media: Meta Set For An Earnings Jump
Facebook parent Meta Platforms reports Q2 earnings late Wednesday. Analysts see Meta posting a 19.6% year-over-year increase in sales, to $38.3 billion, according to FactSet. Earnings are expected to rise 57% year over year to $4.70 per share. Analysts will be listening for commentary on AI-related spending. During Meta’s previous earnings report in April, the company’ plans to significantly boost capex for AI sent the stock tumbling. Meta has scuffled along with the rest of the Magnificent Seven stocks in recent weeks. Still, META shares are up 28% year to date and up 56% over the past 12 months.
Wake-Up Calls Still Ringing For Nvidia, Google, Meta And More
Cloud Computing: Putting Retail Margins In Focus
Amazon.com reports second-quarter earnings results on Thursday. Overall, analysts polled by FactSet expect Amazon to post earnings of $1.03 per share, up 57% from the same quarter a year earlier. Sales, meanwhile, are projected to rise 10.6% year over year to $148.66 billion. Investors will watch for possible improvement in retail margins, and whether the company’s AWS cloud business can continue accelerating its sales growth. Some analysts upped their stock-price targets ahead of the report. Amazon shares are up 20% this year but have slumped in recent weeks. The slide pushed Amazon below the $2 trillion market-cap milestone it had reached late in June.
Dow Jones Laggard Boeing’s Struggle Continues
Dow Jones aerospace icon Boeing faces expectations for steep earnings and revenue slips when it reports Q2 results early Wednesday. Hopes of recovery from the yearslong impact of two fatal 737 MAX crashes in 2018-19 were blown away in January when a door plug blew off an Alaska Airlines 737 MAX aircraft. The fallout led to Boeing’s acquisition of Spirit AeroSystems (SPR), announced in June. Investors will also be tuned to news of the company’s Starliner spacecraft, malfunctions of which have kept two U.S. astronauts stranded at the International Space Station since June 6.
Stock Market Earnings Briefs
Sprouts Farmers Market (SFM) reports Q2 results after Monday’s close. Analysts target earnings per share growth of 10% to 78 cents as sales advance 9% to $1.837 billion. Same-store sales are targeting 3.7% growth. SFM stock scooted off its 21-day exponential average on Friday, flashing a buy point with a break above a three-weeks-tight formation.
Arista Networks (ANET) reports Q2 earnings after the market close on Tuesday. Analysts expect the maker of cloud-computing network gear to report EPS of $1.94, up 23%, with revenue rising 13% to $1.65 billion.
PayPal (PYPL) reports Q2 earnings late Tuesday. Analysts expect the digital payments firm to report EPS of 98 cents, down 15%, with revenue rising 7% to $7.98 billion. Analysts see total payment volume coming in at $417.56 billion.
Advanced Micro Devices (AMD) releases its second-quarter results late Tuesday. Wall Street forecasts AMD earnings of 68 cents a share, up 17% year over year, on sales of $5.73 billion, up 7% in the June quarter. Analysts also will want to hear how AMD’s AI accelerator products are selling.
Mastercard (MA) posts Q2 results before Wednesday’s open. Analysts see EPS up 21.5% to $3.51. Sales should rise 9% to $6.852 billion. Mastercard shares undercut the 200-day moving average on Wednesday after rival Visa posted in-line quarterly earnings and noted a slower spending trend so far in July. MA stock is 10% below its March peak and has been unable to break a downtrend, stalling several times near its 50-day line.
Teva Pharmaceutical (TEVA) will report its second-quarter earnings before the stock market opens Wednesday. Analysts polled by FactSet expect the company to report adjusted earnings of 55 cents per share on $4.06 billion in sales. Earnings would fall by a penny year over year, but sales would jump almost 5%.
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