Stock Market Futures Advance As Big Tech Earnings Take Center Stage
Stock market futures are steadily on the rise in early morning trading on Tuesday. Notably, the tech-heavy Nasdaq seems to have a lead on the other major stock market indexes now. Understandably, this would be thanks to growing investor optimism around the biggest names in tech reporting earnings this week. For some, the current movement in the tech industry would be baffling. After all, we are still amidst a global semiconductor chip shortage that has and continues to limit the business capacity of countless tech firms globally.
To help shed some light on this is Wedbush analyst Dan Ives. In a recent note, Ives said, “We continue to strongly believe despite the lingering black cloud chip shortage that 3Q tech earnings will be standouts this week thus helping drive the sector higher into year-end as the Street continues to underestimate the fundamentals of this multi-trillion digital transformation playing out among consumer and enterprise tech names.”
Not to mention, there are an estimated 165 companies in the S&P 500 reporting earnings this week as well. Should the pattern of strong earnings figures persist, some would argue that the markets could continue to gain. As of 6:48 a.m. ET, the Dow, S&P 500, and Nasdaq futures are up by 0.33%, 0.38%, and 0.55% respectively.
Tesla Joins The $1 Trillion Market Cap Club After Massive Hertz EV Order
Safe to say, Tesla (NASDAQ: TSLA) seems to be starting this trading week on a hot streak. Throughout intraday trading on Monday, TSLA stock soared by over 12% to close at record levels. In fact, the company’s shares hit an intraday high of $1,045.02 per share.
Now, for the most part, all this is due to several positive pieces of news from Tesla and regarding the company. Diving right into it, Tesla received an order for a whopping 100,000 electric vehicles (EVs) from car rental firm, Hertz. Should things go as planned, Tesla could be looking at a payout of over $4 billion from this order.
Additionally, the company is also looking to further optimize its EV manufacturing operations. According to Tesla, it is transitioning towards using lithium-iron-phosphate (LFP) batteries in its vehicles. In theory, LFP tech is much cheaper to produce while boasting more stability than conventional EV batteries. Also, the company topped new car sales figures in Europe throughout September according to automotive industry intelligence firm, JATO Dynamics. Topping all of this news is a massive upgrade and target price raise from Morgan Stanley (NYSE: MS) analyst, Adam Jonas. In essence, Jonas hit TSLA stock with an Overweight rating and a price target of $1,200. As such, investors could be eyeing TSLA stock in the stock market today.
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Facebook Gains After Earnings Beat As Investors Buy Into Current Weakness
Among the tech titans kicking things off this earnings week is Facebook (NASDAQ: FB). In brief, the company posted an earnings per share of $3.22 on revenue of $29.01 billion for the quarter. This came in above estimates of $3.19 for earnings but fell short of revenue projections of $29.57 billion. Despite its somewhat mixed results for the quarter, Facebook continues to make strategic plays. To begin with, the company is adding $50 billion to its current stock repurchase program. This could be another factor explaining FB stock’s gains in pre-market trading today after a recent losing streak.
Even with the ongoing private document dump by whistleblowers, investors seem to see long-term growth potential in Facebook. Backing this up is CEO Mark Zuckerberg via the company’s earnings call after yesterday’s market close.
In it, Zuckerberg noted that Facebook is focusing strongly on its video Reels feature. He also added that “Reels has the potential to be something of that scale,” referring to Facebook’s flagship News Feed and Stories features. Given that it is considered by many as a competitor to the increasingly popular TikTok, the move makes sense. All this coupled with the company’s growing efforts in building the “metaverse” continue to build hype around FB stock now.
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Alphabet Earnings On Tap After The Closing Bell
In other tech-related earnings news, Google parent company Alphabet (NASDAQ: GOOGL) is set to report its latest quarterly results after the closing bell. Now, thanks to its massive presence across numerous fields in the tech world, Google continues to dominate. This seems to be the case from its booming ad and consumer tech services to its major cloud computing division, Google Cloud.
For some perspective, the company raked in a total revenue of $61.88 billion in its second fiscal quarter. Furthermore, the firm also saw year-over-year gains of over 166% in both its net income and earnings per share.
However, even with GOOGL stock holding on to year-to-date gains of over 55%, analysts appear to be bullish on Alphabet. As it stands, Wall Street expects the tech giant to post an earnings per share surge of over 40% year-over-year. Alongside this are projections of year-over-year gains of 37% in total revenue and 50% in Google Cloud revenue. For one thing, there appears to be a focus on the company’s cloud computing division this quarter. Given the growing need for cloud computing services across the board, this would make sense. Regardless, investors would likely be tuning in their radars to GOOGL stock in the stock market now.
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Notable Names Reporting Earnings Today
To highlight, there are plenty of big names posting their latest quarterly results today. This is apparent given the current lineup both in the pre and post-market hours. For starters, the likes of 3M (NYSE: MMM), General Electric (NYSE: GE), Raytheon Technologies (NYSE: RTX), Lockheed Martin (NYSE: LMT), and Eli Lilly (NYSE: LLY) are reporting before the opening bell.
Subsequently, most tech investors would be watching the post-market earnings closely today. This is because Microsoft (NASDAQ: MSFT), AMD (NASDAQ: AMD), Visa (NYSE: V), Twitter (NYSE: TWTR), Robinhood (NASDAQ: HOOD), and QuantumScape (NYSE: QS) are on tap. All in all, we could be looking at an exciting day in the stock market ahead.
