What to Expect from Facebook, Apple, Amazon, Microsoft, Google Earnings Reports?

FAAMG stocks overview

These are also considered the biggest tech stocks in the world, and all but Facebook now rank among the top 5 biggest companies on the planet (Saudi Aramco currently ranks 3rd in the top 5). Facebook this week has actually been pushed out of the number 6 spot and replaced by Tesla, the latter of which surpassed the $1 trillion mark on Monday thanks to a massive 100,000 car order from rental car company Hertz, as well as strong earnings and forward guidance.

Facebook on the other hand indicated struggles in offsetting disruptions to its advertising business while also providing investors with an uncertain outlook for the quarters ahead. Both Facebook and Tesla were rewarded and punished accordingly, which has been a key theme this earnings season as investors sort out which businesses have more earnings potential from those that may be “overvalued” in this new environment.

There have been some jitters that disappointing results from the tech behemoths could result in a sell-off across the entire sector, dragging major indexes down with them.

So far, that’s obviously not been the case. Investors today expect Apple earnings will again blow the top off of Wall Street expectations. Meanwhile, Amazon investors are anxious after the company delivered a rare miss on revenues last quarter due to slower growth in its e-commerce business.

Amazon is again up against very strong year-ago numbers that were largely boosted by the pandemic.

This year, the company also faces not just more competition from physical stores who have transitioned to online but also widespread product shortages as a result of supply chain dislocations.

A lot of attention will be paid to Amazon’s outlook for the holiday shopping season and overall forward guidance for Q4 and Q1.

Data to watch today

Other big names that report earnings today include Caterpillar, Comcast, Gilead, Hershey, Mastercard, Merck, Northrop Grumman, Royal Dutch Shell, Sanofi, Shopify, Starbucks, Stryker, and Yum Brands to name a few.

As for economic data, today’s highlight is the first estimate of U.S. third quarter GDP is expected to show a slowdown in growth from the second quarter due to the Delta Covid wave this past summer.

Growth also likely took a hit from ongoing supply chain disruptions that appear to have intensified in the third quarter.

Pending Home Sales for September are also due today. Turning to oil markets, futures prices are under pressure following news that the European Union agreed to resume talks with Iran talks to revive the 2015 nuclear deal before the end of November. Meaning Iran’s oil production could soon be back in play. Iran’s crude exports dropped from a height of 2.5 million barrels a day in 2017-2018 to around 200,000 bpd in the second half of 2019, when Washington re-imposed full sanctions.

It’s unclear whether adding Iran’s crude output back into the mix will lead to an increase in OPEC production. The oil group has been adding back +400,000 barrels per day to its output on its way to resuming pre-pandemic production levels. However, several OPEC members have struggled to meet their production quotas, which has exacerbated tight global supplies.