Stock Market Live October 27: S&P 500 (SPY) Racing Higher on Potential Trade War Truce
Key Points
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There’s speculation we could see a potential trade war truce with China.
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Markets expect the Federal Reserve to cut interest rates this week after cooler-than-expected inflation numbers.
Live Updates
JPMorgan reiterated an outperform rating on Alphabet
Analysts at JPMorgan reiterated an outperform rating on Alphabet (NASDAQ: GOOG | GOOG Price Prediction) with a price target of $300 per share. As noted by Investing.com, “The firm notes that Alphabet is the second-best performing ‘Mag 7″ name year-to-date, up 37% and 80% from April lows, compared to the S&P 500’s 15% and 36% gains respectively. JPMorgan cites the favorable outcome in the DOJ Search Commercial Agreement trial as removing a major overhang, while highlighting Google’s strong financial performance and AI innovation.”
Analysts at JPMorgan also reiterated an overweight rating on Apple (NASDAQ: AAPL) with a price target of $290. The firm says Apple is heading into earnings with greater positives than at any other time in the last year. The firm is also bullish on iPhone sales.
Analysts at Guggenheim just upgraded Microsoft (NASDAQ: MSFT) to a buy rating ahead of earnings, noting that MSFT is well-positioned for artificial intelligence. The firm has a price target of $586, which is 12% higher than current prices.
Don’t Best against Big Tech or the Federal Reserve this Week
Firms are telling investors not to bet against earnings or the central bank this week.
“Over the last two weeks, we had a more cautious stance on markets,” JPMorgan’s trading desk wrote to clients, as quoted by CNBC. “While we did see a [volatility] spike and some churn, markets ultimately moved higher. Now, as we enter the bulk of Mag7 earnings with a series of trade deals expected to be formally announced this week, the setup is much cleaner.”
Alphabet, Meta, Microsoft, Apple, and Amazon will all post earnings this week. Plus, the Federal Reserve is expected to cut interest rates again this week.
Markets are pushing aggressively higher again.
At the moment, futures are exploding. Dow futures are up 254 points. S&P 500 futures are up 60 points. The NASDAQ is up 333 points. All on news of a potential trade war truce with China.
“I think we have a very successful framework for the leaders to discuss on Thursday,” said Treasury Secretary Scott Bessent from the ASEAN Summit in Kuala Lumpur, as quoted by CNBC.
“This framework potentially includes a delay of China’s rare earths restrictions that caused the latest trade flare-up, a spiking of Trump’s threatened 100% tariffs on China that were to start Nov. 1, and a resumption of Chinese purchases of soybeans. The agreement may include a resolution of the TikTok dispute with the U.S., getting a deal for the U.S. version of the social video app,” they added.
In addition, markets expect the Federal Reserve to cut interest rates this week after cooler-than-expected inflation numbers. Plus, we have quite a few Magnificent 7 stocks posting earnings this week, including Alphabet (NASDAQ: GOOG), Amazon (NASDAQ: AMZN), Apple (NASDAQ: AAPL), Meta (NASDAQ: META), and Microsoft (NASDAQ: MSFT).
Magnificent 7 Stocks Reporting Earnings this Week
On Wednesday, after the bell, Meta Platforms is expected to report revenue growth of about 20%. Last quarter, META posted a 10% jump in revenue and increased its forecast.
Alphabet will report earnings after the bell on Wednesday. Analysts expected GOOG to have grown earnings by 8%. Last quarter, GOOG beat earnings and raised its spending forecast.
Microsoft will post earnings on Wednesday after the bell. Analysts expect to see double-digit earnings and revenue growth in the report. Helping, analysts at Guggenheim just upgraded MSFT to a buy rating with a price target of $586 per share.
The firm “pointed to Azure, Microsoft’s cloud computing platform, as an obvious artificial intelligence beneficiary. He specifically applauded the recurring nature of its consumption model — which he believes acts similarly to a subscription service — as a revenue growth driver going forward,” as also noted by CNBC.
Amazon will post earnings after the bell on Thursday. Analysts expect to see nearly 10% earnings growth from the company. Last quarter, AMZN posted a poor outlook after posting stronger-than-expected earnings results.
And Apple will report after the bell on Thursday. Analysts expect Apple to post 7% growth in earnings and revenue. Last quarter, Apple posted its strongest revenue growth since 2021.
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