What to Expect in the Week Ahead (PLTR, GOOG, AMZN, and ARM Earnings; Non-Farm Payrolls)

Moomoo Breakfast US wrote a column · Feb 2 12:10

What to Expect in the Week Ahead (PLTR, GOOG, AMZN, and ARM Earnings; Non-Farm Payrolls)

Earnings Preview

Next week, all eyes will be on Alphabet and Amazon as megacap tech earnings season continues. So far, the performance of the 'Magnificent Seven' tech stocks has generally been positive. Tesla, Meta, and Apple have all experienced gains following their earnings reports. In contrast, Microsoft saw its shares drop over 6% following its earnings release, as its substantial investments in AI did not meet market expectations regarding returns on investment (ROI).

Looking forward, $Alphabet-A (GOOGL.US)$ is anticipated to announce a fourth quarter revenue increase of 12.05% year-over-year for 2024, with its earnings per share (EPS) expected to climb by 29.42%. Similarly, $Amazon (AMZN.US)$ is projected to report a 10.17% growth in Q4 revenue compared to the previous year, while its EPS is predicted to experience a significant boost of 48.51%.

$Palantir (PLTR.US)$ is scheduled to release its financial report on February 3rd, with high expectations pinned on its Q4 performance. Analysts project a significant 27.69% increase in revenue and a 22.75% rise in earnings per share (EPS). The data analytics firm, favored by the Pentagon for enhancing governmental and corporate efficiency, continues to attract positive attention. CNBC's Jim Cramer highlighted the company's promising trajectory, which is partly driven by investor confidence in CEO Alex Karp.

Macroeconomic Events

The upcoming nonfarm payrolls report for January is highly anticipated, with economists expecting the U.S. economy to have added 170,000 jobs, a decrease from the previous month's 256,000. The unemployment rate is expected to remain steady at 4.1%. This data will play a critical role in the ongoing U.S. interest rate debate.

Amidst policy uncertainties, the Federal Reserve has maintained interest rates at 4.25-4.50% in January. Despite President Trump's call for lower rates, the Fed's decision reflects concerns over strong economic growth and rising inflation, which hit a five-month high of 2.9% in December.

Adding to the economic volatility, President Trump announced that starting Saturday, tariffs of 25% on imports from Mexico and Canada, and 10% on Chinese imports will be implemented. These measures, aimed at benefiting American companies, have sparked fears among economists about potential inflationary effects and dampened business and consumer spending.

Investors now face a challenging environment, with market volatility fueled by quarterly earnings and policy shifts. Next week, attention will turn to corporate executives' responses during earnings calls, which will shed light on real-time reactions to the evolving policy landscape and their strategies moving forward.