Megacap Earnings and Fed's 35% Hike Odds Test Stocks Next Week
Updated
Updated · CNBC · Jul 24
Megacap Earnings and Fed's 35% Hike Odds Test Stocks Next Week
3 articles · Updated · CNBC · Jul 24
Summary
Amazon, Meta, Microsoft and Apple report next week as investors reassess whether heavy AI spending can keep supporting megacap valuations after Alphabet's results rattled the group.
More than 5% has been wiped from the Roundhill Magnificent Seven ETF this week, while semiconductor ETFs rose, underscoring a split between AI infrastructure winners and the cash-burning hyperscalers funding them.
The Fed announces its rate decision Wednesday, with futures implying a 35% chance of a quarter-point hike even though the broader consensus still expects no move until September.
Oil above $100 a barrel and rising inflation expectations have darkened sentiment, leaving the market vulnerable as August and September are typically weak months in midterm election years.
Still, S&P 500 companies are expected to deliver 38% second-quarter earnings growth, giving bulls a counterweight if megacap results and the Fed avoid fresh surprises.