Microsoft and Meta Earnings, Core PCE in Focus: Market Movers & Key Economic Data
- NexxtGen Markets
- Apr 30
- 4 min read
Here's your latest update from the team at NexxtGen Markets here in the City of London 🇬🇧
As global markets continue to react to a mix of economic data and corporate earnings, investors are particularly focused on the upcoming reports from Microsoft and Meta, alongside crucial inflation data like the Core PCE. With trade tensions, rising costs, and AI-driven investment strategies dominating conversations, here’s an update on what to watch today.
S&P 500 Futures Dip: Trade Optimism Boosts Sentiment
S&P 500 futures dipped -0.5% after the index closed up 0.58% on Tuesday, marking its sixth straight gain—the longest win streak since November. The positive sentiment was largely driven by optimism over trade talks and a potential resolution to tariff tensions. The continued climb suggests cautious confidence, but global events, particularly regarding tariffs, are likely to keep markets on edge.
Volkswagen: Profit Drop Amid U.S. Tariffs
Volkswagen (VOW3.DE) saw its Q1 profit drop by a significant 37% to €2.9B, impacted by U.S. tariffs that have rattled the European auto sector. While revenue increased by 2.8%, driven by growth outside China, the overall decline in profitability signals ongoing challenges for Europe’s largest automaker. The renewed tariff concerns add to the uncertainty faced by global automakers as they aim to stabilise after pandemic-induced supply chain disruptions.
Starbucks: Earnings Miss, Consumer Demand Weakening
Starbucks (SBUX) reported a disappointing Q2 earnings miss, sending the stock down 28% from its March peak. Despite strong brand loyalty and a loyal customer base, Starbucks faces rising costs and weakened consumer demand, particularly in key markets. Investors are anxiously awaiting the company’s full update to assess whether international growth and potential cost adjustments can stabilise margins.
Samsung: Strong Earnings Amid Chip Demand, But Stock Flat
Samsung posted strong Q1 results, surpassing expectations with higher revenue and profit driven by robust chip demand. However, the company’s shares remained flat post-earnings, as concerns about pricing pressure and geopolitical risks continue to cloud the outlook for the global tech giant. The stock’s stagnant movement highlights a cautious investor sentiment, despite positive earnings.
UBS: Strong Trading Activity, But Tariff Risks Loom
UBS (UBS) exceeded Q1 profit expectations, reporting $1.69B in profit, driven by strong trading activity. However, the Swiss bank warned of growing macro risks, particularly from U.S. tariffs and regulatory scrutiny. While UBS is benefiting from trading momentum, concerns about global growth and rising regulatory pressures could weigh on the bank’s future outlook.
Microsoft & Meta Earnings: AI, Cloud, and Ad Growth Under Scrutiny
Microsoft: A Focus on AI and Cloud Growth
Microsoft reports its Q3 earnings after the close on Wednesday, with expectations for 10% year-over-year growth in both revenue and profit. Investors are eager to hear more about how Microsoft’s $13B investment in OpenAI is paying off, especially in the enterprise AI space. Despite concerns over tariff risks and rising AI costs, Microsoft’s dominant position in cloud services and its recurring software income remain strong pillars for the company. With dividends and buybacks enhancing shareholder value, Microsoft’s stock has consistently outperformed earnings estimates for the last eight quarters.
Meta: Ad Growth vs. AI Spending
Meta, the parent company of Facebook, also reports earnings after hours on Wednesday. Analysts are expecting strong double-digit ad growth, but the company’s $60B annual AI spend has raised concerns about future profitability. Despite Meta’s robust position in digital advertising and improvements in AI-driven targeting, its stock is still over 30% below its all-time highs. With eight consecutive earnings beats, investors are hopeful that Meta can continue to leverage AI for further growth, even as the company navigates the challenges of heavy AI investments.
Caterpillar & Materials: Cyclical Stocks Under Pressure
Caterpillar (CAT) and other materials companies like Vulcan and Martin Marietta are reporting today. All three have been in a downward trend, with Caterpillar down 26% from its November highs. Investors will be closely watching the results for insights into industrial demand amid a slowing economy and the impact of interest rates on construction and manufacturing activities.
What Are Cyclical Stocks?
Cyclical stocks, like those in construction and manufacturing, are particularly sensitive to economic cycles. They perform well during periods of economic growth, but face challenges when growth slows or interest rates rise. Understanding how cyclical stocks behave can help investors make more informed decisions during different market conditions.
Market Movers: LifeMD, Okta, Honeywell Lead the Way
LifeMD (LFMD) surged +41% on strong growth prospects in the health sector.
Hims & Hers (HIMS) rose +23%, with growing interest in its telehealth and wellness services.
Okta (OKTA) gained +7% as demand for its identity and security solutions continues to rise.
Honeywell (HON) increased +5%, as it benefits from growth in automation and aerospace sectors.
Coming Up Today: Key Economic Data
10:00 AM GMT: Eurozone GDP (Q1 Flash): Expected to hold steady at +0.2% QoQ, with a slowdown in YoY growth to 0.9%. Watch for movement in EUR pairs.
1:00 PM: German Inflation (April Flash): Slowing to 2.1% YoY, and +0.4% MoM. Focus on EUR pairs.
1:30 PM: U.S. Core PCE (March): Expected to cool to +0.1% MoM from +0.4%. This is a key inflation measure for the Fed.
3:00 PM: Pending Home Sales (March): Expected to rise +0.8% MoM.
What to Watch: Core PCE Inflation Report
Core PCE, the Fed’s preferred inflation measure, is expected to ease to 2.2% YoY, down from 2.4% in March. A cooling inflation reading could fuel rate cut hopes, but any surprise to the upside may reignite concerns about sticky inflation. Core PCE is a critical data point, and investors will be watching closely for any signs of a shift in inflation trends.
📈 Join Us
Start your trading & investment journey today at https://bit.ly/nexxtgenmarkets
⚠️ Risk Warning
Trading and investing carry risks. You should seek professional advice before engaging in such activities. Leverage can amplify both gains and losses. Past performance is not indicative of future results. Full risk disclosure: http://nexxtgen.pro/risk
🧾 NexxtGen Markets partner with eToro and may receive a small commission for anyone joining eToro via our website or socials.
---
Comments