Week Ahead on Wall Street: Powell’s Swan Song and Big Tech

Estimated reading time: 8 minutes

It’s an important and potentially sentimental week.

At a Glance

• The news: Mega-cap tech companies including Alphabet, Apple, Microsoft, and Meta are scheduled to report quarterly earnings. The Federal Reserve also meets again on interest rates — in what could be Jerome Powell’s final act as Fed chair.
• The context: The Fed looks to be in wait-and-see mode on the fallout from the Iran war. Meanwhile, analysts have raised their estimates for tech earnings as the prospects for artificial intelligence keep building. 
• Your move: Pay close attention to results and commentary from Big Tech. If these higher earnings estimates bear out, stocks exposed to AI could go up.

Let’s start with the Federal Reserve. The central bank will release its interest rate decision Wednesday afternoon. Although officials aren’t expected to change rates (there’s too much uncertainty with oil markets and the war in Iran,) this meeting could be Jerome Powell’s last meeting as Fed chair. His term expires in mid-May, so it all depends on whether Kevin Warsh is confirmed as his replacement by then. 

If it is Powell’s last as chair, his presence may be missed by investors who have come to see him as one of the central bank’s greatest leaders. There could be a transition period as they get used to the Fed under new leadership.

We also have the biggest week of the first-quarter earnings season, with tech titans including Alphabet, Apple, Microsoft, and Meta Platforms reporting, along with other big names like Coca-Cola and Eli Lilly. Overall, 182 companies accounting for over half of the S&P 500’s market capitalization will release results.

Investors have been caught in a tug-of-war between near-term anxiety and long-term optimism regarding a rapidly shifting macro environment.

On one hand, there are the immediate pressures: a hawkish Fed, reignited inflation, and volatile energy markets that are complicating business plans. On the other hand is the undeniable, transformative promise of artificial intelligence — a technological leap so massive it could make current headwinds look like blips on the radar.

If the tech generals stumble, we could be in for a turbulent transition into May. But if they deliver the goods, stocks might have the stability they need to push to even greater heights. 

On the Docket

Monday

• April Dallas Fed Manufacturing Activity: This is the Dallas Fed’s survey of manufacturing executives in the region on business conditions and their outlook.
• Earnings
  • Major companies: Verizon (VZ)
  • Others: Cadence Design Systems (CDNS), Public Storage (PSA), Nucor (NUE), Ventas (VTR), Cincinnati Financial (CINF), AvalonBay Communities (AVB), Brown & Brown (BRO), Domino’s Pizza (DPZ), Universal Health Services (UHS), Alexandria Real Estate Equities (ARE)

Tuesday

• February FHFA House Price Index: This is a broad measure of single-family house prices released by the Federal Housing Finance Agency. 
• April Richmond Fed Manufacturing Activity: The Richmond Fed’s survey of manufacturing executives in the region on business conditions and their outlook. 
• April Richmond Fed Non-Manufacturing Activity: The Richmond Fed’s survey of services executives in the region on business conditions and their outlook. 
• April Conference Board Consumer Confidence: How consumers feel about economic conditions affect their spending habits. This survey places a particular focus on job availability and the state of the labor market. 
• April Dallas Fed Non-Manufacturing Activity: This is the Dallas Fed’s survey of services executives in the region on business conditions and their outlook.
• Earnings
  • Major companies: Visa (V), Coca-Cola (KO), T-Mobile US (TMUS), Corning (GLW), Welltower (WELL), Booking Holdings (BKNG), S&P Global (SPGI), Seagate Technologies (STX), Starbucks (SBUX)
  • Others: Waste Management (WM), United Parcel Service (UPS), American Tower (AMT), Sherwin-Williams (SHW), Robinhood (HOOD), Hilton Worldwide Holdings (HLT), Ecolab (ECL), Mondelez International (MDLZ), General Motors (GM), PACCAR (PCAR), Teradyne (TER), NXP Semiconductors (NXPI), ONEOK (OKE), Sysco (SYY), Arch Capital Group (ACGL), Ingersoll Rand (IR), Kimberly-Clark (KMB), Extra Space Storage (EXR), Xylem (XYL), FirstEnergy (FE), Edison International (EIX), PPG Industries (PPG), CMS Energy (CMS), Equity Residential (EQR), Expand Energy Corporation (EXE), Fair Isaac (FICO), Omnicom Group (OMC), Veralto Corporation (VLTO), Centene (CNC), Incyte (INCY), Zimmer Biomet Holdings (ZBH), F5 Networks (FFIV), Essex Property Trust (ESS), CoStar Group (CSGP), Pentair (PNR), Franklin Resources (BEN), Avery Dennison (AVY), Allegion (ALLE), Invesco (IVZ), Boston Properties (BXP)

Wednesday

• March Wholesale and Retail Inventories: Wholesalers and retailers often operate as intermediaries for the sale of manufactured products, serving as a key part of the goods supply chain. 
• March Wholesale Inventories and Sales: Wholesalers often operate as an intermediary between manufacturers and retailers, serving as a key part of the goods supply chain. 
• March Building Permits and Housing Starts: Construction data is a leading indicator of economic activity. 
• March Factory and Durable Goods Orders: These metrics give insight into underlying trends for leading cyclical indicators. 
• FOMC Interest Rate Decision: The Federal Reserve will announce any changes to monetary policy after the conclusion of its two-day FOMC meeting, in addition to providing commentary on the economy. It’s one of eight regularly scheduled meetings per year.
• Weekly Mortgage Applications: Mortgage activity gives insight on demand conditions in the housing market.
• Earnings
  • Major companies: Alphabet (GOOGL), Alphabet (Non-Voting Shares) (GOOG), Microsoft (MSFT), Amazon (AMZN), Meta Platforms, Inc. (META), AbbVie (ABBV), KLA-Tencor (KLAC), Amphenol (APH), Qualcomm (QCOM), Equinix (EQIX)
  • Others: General Dynamics (GD), Carvana (CVNA), Regeneron Pharmaceuticals (REGN), Automatic Data Processing (ADP), O’Reilly Automotive (ORLY), Phillips 66 (PSX), Aflac (AFL), Allstate (ALL), Garmin (GRMN), Entergy (ETR), Ford (F), eBay (EBAY), Old Dominion Freight Line (ODFL), Chipotle Mexican Grill (CMG), YUM! Brands (YUM), EMCOR Group (EME), Vulcan Materials (VMC), GE HealthCare Technologies Inc (GEHC), Vici Properties (VICI), Biogen (BIIB), American Water Works (AWK), Cognizant Technology Solutions (CTSH), Humana (HUM), Bunge Global S.A. (BG), SBA Communications (SBAC), Verisk Analytics (VRSK), CH Robinson Worldwide (CHRW), Lennox International (LII), Invitation Homes (INVH), Everest RE Group (EG), IDEX (IEX), Regency Centers (REG), Mid-America Apartment Communities (MAA), Tyler Technologies (TYL), Align Technology (ALGN), Generac Holdings (GNRC), Stanley Black & Decker (SWK), UDR (UDR), MGM Resorts International (MGM)

Thursday

• March Personal Income and Spending: These numbers give insight into how Americans are doing, which is important since consumer spending accounts for about two-thirds of economic growth in the United States. 
• March Personal Consumption Expenditures Price Index: The Fed targets this inflation measure for its price stability mandate and believes PCE to be the best measure of consumers’ spending habits.
• 1Q Employment Cost Index: This is the most comprehensive measure of worker compensation, including wages, bonuses, benefits and more.
• 1Q A GDP First Estimate: The primary measure of economic activity in the United States, which is measured as total expenditure on a country’s goods and services. 
• April Chicago Business Barometer: The barometer provides information on U.S. economic activity and business conditions, consisting of seven activity indicators and three buying policy indicators. 
• March Leading Economic Index: This is an index composed of various economic indicators that have historically led changes in the broader economy.
• Earnings
  • Major companies: Apple (AAPL), Eli Lilly (LLY), Mastercard (MA), Caterpillar (CAT), Merck & Co (MRK), Amgen (AMGN), ConocoPhillips (COP), Sandisk Corporation (SNDK), Western Digital (WDC), Stryker (SYK), Parker-Hannifin (PH), Bristol-Myers Squibb (BMY), Altria Group (MO), Trane Technologies (TT), Southern Company (SO)
  • Others: Quanta Services (PWR), Intercontinental Exchange (ICE), Monolithic Power Systems (MPWR), Illinois Tool Works (ITW), CRH Public Limited Company (CRH), Cigna (CI), Royal Caribbean Cruises (RCL), Valero Energy (VLO), Air Products and Chemicals (APD), L3Harris Technologies (LHX), Arthur J Gallagher & Co (AJG), Ametek (AME), Carrier Global Corp (CARR), Xcel Energy (XEL), Cardinal Health (CAH), American International Group (AIG), Hershey (HSY), Martin Marietta Materials (MLM), Iron Mountain (IRM), ResMed (RMD), DTE Energy (DTE), Hubbell (HUBB), Willis Towers Watson Public (WTW), DexCom (DXCM), T Rowe Price Group (TROW), Laboratory of America Holdings (LH), Smurfit WestRock (SW), First Solar (FSLR), Fortive (FTV), Alliant Energy (LNT), Broadridge Financial Solutions (BR), Weyerhaeuser (WY), International Paper (IP), Kimco Realty (KIM), Textron (TXT), Clorox (CLX), GoDaddy (GDDY), Camden Property Trust (CPT), Builders FirstSource (BLDR), Baxter International (BAX), A O Smith (AOS), Norwegian Cruise Line Holdings (NCLH), Molson Coors Brewing (TAP)

Friday

• April University of Michigan Consumer Sentiment: How consumers feel about economic conditions affect their spending habits. This survey places a particular focus on inflation and its trajectory. 
• April Kansas City Fed Non-Manufacturing Activity: The Kansas City Fed’s survey of services executives in the region on business conditions and their outlook.
• Earnings
  • Major companies: Exxon Mobil (XOM), Chevron (CVX), Linde PLC (LIN)
  • Others: Motorola Solutions (MSI), Aon Plc (AON), Colgate-Palmolive (CL), Dominion Energy (D), Ares Management Corp (ARES), Cboe Global Markets (CBOE), Estee Lauder Companies (EL), LyondellBasell Industries (LYB), Church & Dwight (CHD), Moderna (MRNA), AES (AES), Federal Realty Investment Trust (FRT)

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