Oct 27, 2022
VOT Research Desk
After the previous surge, risk appetites were partially satisfied, and equity markets paused on Wednesday. In anticipation of a Fed turnaround, equity markets have risen by nearly 10% from their lows.
The ongoing earnings season continues to show that while corporates are slowing down, consumers are holding up reasonably well.
The impact of ad spending on Alphabet (GOOGL) and Meta Platforms (META) is most obvious in the big tech sector, while Visa (V), Pepsi (PEP), Coca-Cola (KO), and a number of other companies continue to experience positive pricing pressure.
It seems to confirm that a looming inflationary recession is currently in its slowing phase due to inflation. META has thrown another wrench into the proceedings by dramatically collapsing overnight.
With actual revenue above expectations, earnings weren’t too awful, but the outlook for expenses and margins was what caused the sudden sell-off.
Only Apple (AAPL) and Amazon (AMZN) remain to stop the decline in tech earnings at this point. When we get US GDP, however, all eyes will initially shift to the macro side of the equation.
There will be something to debate about for both hawks and doves given the most recent data, which shows a 2.6% growth rate. All eyes are now on Apple’s earnings report following the closing. How are margins holding up, and how well is the iPhone 14 selling? Amazon is added after the close. In my opinion, the market is currently dovish toward the ECB, and both rates and the euro are declining. On the similar US GDP figure, oil is greater.
This will certainly result in greater uncertainty for markets and a pause until Apple. Consumer companies are supposedly doing well right now, and big tech is doing poorly. Apple combines both, but it’s targeted for luxury shoppers.
S&P 500 Technical Analysis Report
For the SPY, the double top and resistance at $389 are still in place. For this rise, $379 is the pivotal price.
As META dampens enthusiasm, Apple stock is anticipated to continue its regression day.
