1. Federal Reserve lowered rates by 25 basis points; caution on future cuts. 2. Alphabet, Meta, and Microsoft reported strong earnings, beating expectations. 3. Capital expenditures for Big Tech are rising significantly for 2025 and 2026. 4. Increased investments in AI anticipated, reassuring market fears of a bubble.
The strong quarterly earnings from major tech firms indicate robust demand, boosting investor confidence. Historically, strong earnings from tech often lead to positive S&P 500 momentum.
The earnings and capex plans from large-cap companies directly influence market sentiment and investor behavior, particularly in technology-heavy sectors of the S&P 500.
Immediate market reactions are expected due to earnings reports, though long-term effects depend on sustained growth. Following previous earnings seasons, initial gains have typically led to sustained upward trends, albeit volatile.