Apple’s Earnings Can Boost the Stock Market. Here’s What It Needs to Deliver.

Investors will be hoping it’s a case of saving the best until last when it comes to Big Tech earnings. Apple and Amazon both report after the bell Thursday, and the stock market is in need of a boost after a shaky start to August

It won’t be easy, though. As of Friday, 80% of companies have beaten earnings expectations so far, according to FactSet data. But those beats were met with an average stock price fall of 0.2% in the period two days either side of earnings.

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A solid beat doesn’t seem to be enough these days, particularly for tech stocks after their impressive 2023 rally. Apple’s 48% gains, taking it to a market cap above $3 trillion, mean the bar is especially high.

That being said, Wall Street expects the tech giant’s revenue to fall 1.4% year over year. If, as expected, iPhone and iPad sales fall in the company’s fiscal third quarter, it could be time for Apple’s services business to shine.

Meta and Alphabet’s stronger-than-expected digital advertising performance, suggests an upside surprise could be on the table in its services unit. There’s also scope for an unexpected AI announcement.

Apple’s push into financial services, in particular, seems to be going well. Apple said its high-yield savings account, in partnership with Goldman Sachs, has reached $10 billion in deposits since its April launch.

A beat strong enough to boost the stock would be a triumph in diversification for Apple, even more so after Qualcomm’s earnings suggested the smartphone slump is here to stay.

As a bellwether for consumer demand and the S&P 500’s largest stock, the broader market could really do…


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