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Tech Tensions & Tidings: US-China Friction, Wall Street Whirlwinds,& the Big Tech Earnings Showdown

text caption "Weekly brief" logo "Wealthor" a bull and a bear


What Happened Last Week?

US

  • Semiconductor Technology: The US tightened its grip on China’s access to advanced US semiconductor technology.

  • Wall Street Earnings: Wall Street’s big players got the earnings season rolling. JPMorgan delivered promising results, while Goldman Sachs had a more subdued performance.

Europe

  • Manchester United: English soccer giant Manchester United’s off-field ownership drama intensified as a Qatar-based banker withdrew his bid.

  • Rolls-Royce: British aircraft engine maker Rolls-Royce announced workforce reductions, even as its profit and stock price increased.

Asia

  • China's Economic Growth: China reported a third-quarter growth of 4.9%, attributed to the resurgent Chinese consumer.

What Does It All Mean?

  • US-China Tech Friction: The ongoing tension between the US and China revolves around technology. The US is concerned about China leveraging Silicon Valley tech for military purposes. Nvidia, a major tech firm, is feeling the impact of these restrictions.

  • Bank Earnings: While bank earnings provide a snapshot of the current economy, they don't necessarily predict future trends. JPMorgan's positive results indicate a stable economy, but Goldman Sachs' results were a reminder of the unpredictability of the financial sector.

  • ASML and the Semiconductor Industry: ASML, a key player in the semiconductor industry, reported a 40% decrease in third-quarter new orders. However, the company remains optimistic about a potential industry turnaround by 2025.

  • China's Economic Trajectory: China's economic performance has fluctuated, but the recent 4.9% growth in the third quarter suggests potential momentum building in the world's second-largest economy.

This Week’s Focus: Tech-o-rama

  • Big Tech Earnings: Microsoft, Alphabet, Apple, Meta, and Amazon are set to report their third-quarter results.

    • Microsoft: The spotlight will be on Azure, Microsoft's cloud services business. The market anticipates a yearly growth rate of close to 27%.

    • Alphabet: Investors will be keen on Alphabet's cloud growth and any advancements in ad improvements, particularly on YouTube.

    • Apple: Rumors suggest underwhelming iPhone and Macbook sales, especially in China. The focus will be on Apple's strategy to counteract this trend.

    • Amazon: After a stellar previous earnings season, all eyes will be on Amazon's cloud business, AWS, and its retail performance.


The Week Ahead

Investors and market analysts will closely monitor the tech giant's earnings reports and decipher the potential implications for the broader market and individual stock trajectories.

  • Monday: Earnings: Starbucks.

  • Tuesday: UK unemployment (August). Earnings: Microsoft, Alphabet, Visa, Coca-Cola.

  • Wednesday: German Ifo business climate (October). Earnings: Apple, Meta, Boeing, Thermo Fisher.

  • Thursday: European Central Bank interest rate decision, US GDP (Q3) Earnings: Amazon, MasterCard, Intel.

  • Friday: US PCE price index (September).

Conclusion

  • Driving Results:

    • The US-China tech dispute continues to shape global trade and market dynamics.

    • Wall Street's mixed earnings results highlight the unpredictable nature of the financial sector.

    • China's economic growth indicates potential stabilization and momentum.

  • Pathways Forward:

    • Investors should remain cautious and informed, especially with the upcoming tech earnings reports.

    • Diversification remains a key strategy in navigating the current market landscape.

    • Continuous monitoring of global events, especially in the tech and financial sectors, will be crucial for informed decision-making.


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