What Are We Talking About This Week?
Unpacking Alphabet: What Happened and What Does It Mean for The Magnificent Seven Renaissance?
Rotation has a new risk-on favorite, and it isn’t semiconductors.
📡 Market Radar 🛰
Economic Report
FOMC Meeting
Futures markets are positioned for a hawkish tilt, whereas many equity markets remain dovishly positioned. One is offside. This meeting — even more so than PCE that releases the following day — will decide which market needs to move.
Corporate Business
Hyperscaler Earnings: AMZN, META, MSFT
Alphabet put up monster growth, but the market decided to prioritize the costs. It would be a shock if capex costs went down at the remaining hyperscalers. Is the renaissance in software and the MAGS over? If so, what does it mean for equities?
Monday
Macro
N/A
Micro
N/A
Tuesday
Macro
N/A
Micro
UPS (UPS) | BTO
Corning (GLW) | BTO
Bloom Energy (BE) | ATC
KLAC (KLAC) | ATC
Wednesday
Macro
FOMC Meeting
Micro
SoFi (SOFI) | BTO
Microsoft (MSFT) | ATC
Meta (META) | ATC
Robinhood (HOOD) | ATC
Thursday
Macro
Preliminary Q2 GDP
Weekly Jobless Claims
June Personal Consumption Expenditures (PCE) Index
Micro
Amazon (AMZN) | ATC
Apple (AAPL) | ATC
Reddit (RDDT) | ATC
Friday
Macro
N/A
Micro
Exxon (XOM) | BTO
Chevron (CVX)
Alphabet Post-Earnings Q&A
Q: What Happened?
Alphabet delivered impeccable growth on its most important business segment: Google Cloud reported year-over-year growth of 82%: $24.8B v $13.6B.
However, it came at a cost.
The first negative free-cash-flow (FCF) quarter in its history as a publicly traded company.
Operating margins compressed ~2%.
Management further increased capex guidance — from $180-$190B to $195-$205B — implying this isn’t the bottom for FCF or margins.
Investors decided to prioritize the cost over the growth, shaving 7% off the stock.
Q: What Now?
Depends on whether you are an investor or trader.
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