Key insights
- Today's events, including Powell's press conference and earnings from four of the Mag 7, represent a significant inflection point for the US equity market. Powell's likely final press conference as Fed Chair, coupled with key economic data releases, sets the macro stage. The earnings reports from GOOGL, AMZN, META, and MSFT will test the narrative of AI-driven growth and capex, influencing not only their stock performance but also the broader tech sector and NVDA. The outcome will likely set the tone for
Powell's likely final press conference as Fed Chair plus 4 of the Mag 7 reporting earnings, all in the same 24 hours.
The FOMC decision is fully priced as a hold so it's not really the story. The 2:30 PM presser is, since this Powell's last one as Chair (his term ends in May). Kevin Warsh takes over in June and wants a pretty different Fed: new inflation framework, smaller balance sheet, possibly killing the post-meeting press conference cadence. CPI also reaccelerated on the Iran/oil shock, and GDP, PCE, and ECI all drop Thursday morning.
Then after close, four giants report on the same evening. Combined market cap is north of $10T. The shared narrative is AI capex, with combined 2026 commitments easily the largest in tech history. Today is the first real test of whether the spend is producing actual revenue or just burning cash.
The setup going in is uneven. GOOGL and AMZN both had strong last quarters with cloud reaccelerating, but spooked investors with massive capex guides (AMZN dropped the biggest single-company capex guide ever and got dumped after hours). META has the cleanest story heading in with strong ads and a confident next-quarter guide, but it's run hard into the print so it's priced for execution. MSFT is the contrarian setup, the only one of the four that's down YTD while the others are all up recently, so the bar is the lowest and any beat on Azure probably sends it up.
Whatever happens tonight sets the tone for tech into summer. Either AI capex finally shows up in the numbers or the skeptics get their moment. Worth remembering these four are basically NVDA's biggest customers, so whatever they say about capex directly shapes the AI trade well beyond their own stocks.
Are you buying, selling, or just enjoying some popcorn from the sidelines?