Article published at 9:10 a.m. CT
JJ Kinahan is Senior Vice President, Head of Retail Expansion and Alternative Investment Products at Cboe Global Markets, Inc. (Cboe).
Key Takeaways:
- Alphabet, Tesla and IBM will report after the bell
- Super Micro Computer shares pop amid strong forecast
- Crude oil continues its upward path as Middle East war intensifies
Investors were balancing the earnings-packed calendar that has a handful of potential market-moving results after the session ends with higher oil prices and the instability in the Middle East on a couple fronts.
Given the market sentiment in recent weeks, at the end of the day the only thing that will truly matter to investors is how earnings results unfold. The three major indices were mixed in early trading, with the S&P 500 Index off 0.27%, the Nasdaq Composite off 0.44% and the Dow Jones Industrial Average up 0.19%. Yesterday, they held on to earlier gains to end the session solidly higher. The S&P 500 added 0.89%, snapping its three straight days of losses, while the Nasdaq advanced by 1.29% and the Dow moved 0.74% higher. Keep watch on their intraday movements today.
Alphabet and Tesla are both slated to report earnings after the close, setting the stage for expectations of the so-called Magnificent 7. Overall, the outlook is for the Mag 7 to report a 31% growth in the second quarter, that’s more than half the percentage growth in the first quarter, but still considered solid, according to FactSet Research. The results are expected to signal how productive the ramp up in artificial intelligence spending is going.
Investors will be looking at a number of fronts in Alphabet’s earnings release that include the strength of its revenues and how well its cloud and YouTube segments are performing. Also high on the agenda is its backlog of customers locking in AI and cloud services, which stood at $460 billion last month. How much might Google’s parent need to boost capital expenditure spending to meet that? Alphabet shares were modestly higher early on.
Tesla investors will be looking for progress of its Optimus robots and its robotaxis production given the pricey investments into them. The automotive and clean energy maker already said it had a strong car-selling quarter. Tesla shares headed lower by 0.84%.
IBM, which looks to be in a no-lose situation, is also on the after-the-bell calendar. Investors already have low expectations given the stark warning the software giant issued on July 14. But any bright light — or really, any light — it might offer could give the stock a bounce. Since the warning, shares have backtracked some 28%, and today are hugging the flatline in early trading.
As a reminder of potential stock activity, the post-earnings implied moves in either direction for each were in mid- to high single digits: Alphabet’s expected move is roughly 5.5%, Tesla’s is at 7%, mirroring the last couple years, and IBM is at a 6% move, which has tracked lower four of the last five quarters.
WTI Crude Oil prices climbed better than 3% to trade in the $87 range in early trading after the U.S. and Iran both seemed to agree on not having ongoing talks. That upward momentum marks the highest level in six weeks and comes as the U.S. and Iran trade strikes for the 11th straight day. Crude oil prices climbed higher in intraday trading yesterday, but managed to trim some of those gains by the close, with WTI crude staying just a penny below $85 per barrel, up 2.11%.
On the flip side, energy producers are in good stead with Chevron, ConocoPhillips, ExxonMobil and BP all tracking 1%-plus to the upside.
On the tech stock front, we’re looking at a scene we’ve seen before: Tech stocks lead the way upward one day but pull back the next. Yesterday, investors bought on the dips, a sign they believe the AI-trade still has legs despite recent setbacks and worries about capital expenditure overspending. Today, chipmakers are declining – Nvidia, Intel, Qualcomm and Advanced Micro – all down 1% to better than 4%.
Super Micro Computer shares popped some 15% after forecasting significantly better-than-expected fourth-quarter growth margins and revenues that are estimated to be near the low end of it $11.0 billion to $12.5 billion guidance. Backlog orders rose to record levels at the end of fiscal 2026, the company said, citing new orders that are in excess of $60 billion. All new orders are expected to be delivered over future quarters. Supermicro said it will report earnings on Aug. 11 after the bell.
Dell Technologies and Hewlett Packard enjoyed the spill-over effect, riding higher by about 2% each in the early going, after closing solidly higher yesterday.
Happy trading!
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