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Apple and Big Tech earnings or the Fed: What matters more next week?

Friday July 22, 2022. 08:57 PM , from Mac Daily News
Apple and Big Tech earnings or the Fed: What matters more next week?
Rising interest rates have been a main focus for investors since early this year, when the Fed began an attempt to catchup to rampant U.S. inflation by tightening monetary supply, but Apple and other, lesser Big Tech earnings are on tap. Which matters more to the market and investors?

Sabrina Escobar for Barron’s:

“A look at sentiment indicators suggests that Americans are eyeing the rate decision by the Fed more closely than upcoming tech earnings, and that makes sense,” wrote Peter C. Earle, economist at the American Institute for Economic Research. “Inflation is hitting Main Street very hard right now.”
June’s inflation data came in hotter than expected, prompting analysts to predict that the Fed could raise the federal-funds rate by at least 0.75%, and as much as 1% at the end of its July meeting next Wednesday. A 1% increase would be the biggest interest rate hike since the 1980s, and would heighten concerns that the economy could dip into a recession.
“If they come in with a 75-basis-point hike as we expect, but soften the language about future hikes it would be a huge boost to markets next week,” said Luke Tilley, chief economist at Wilmington Trust.
For some experts, however, the Fed’s decision may actually take a back seat to tech earnings.
“FAANG earnings along with Microsoft will be front and center for investors to give some better direction/clarity on the overall demand environment in this shaky macro with the tech sector already slowing hiring across the board,” said Wedbush analyst Daniel Ives.

MacDailyNews Take: As always, it won’t be about “what have you done” (fiscal Q3 earnings) so much as “what will you be doing for us in the foreseeable future?” Any color that Apple provides on the July 28th conference call about the upcoming quarter (fiscal Q4) will be crucial.
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