The main goal of the Fed is still to return inflation to the target level of 2 percent, and they announced a couple more interest rate increases in the coming months, which the market interpreted as two additional interest rate increases of 0.25 percent each, up to a level of 5. 25 percent. Inflation is still slowing, so everyone hopes those increases will be enough.
The company reports for the last quarter of 2022 are still in focus on the stock exchanges.
Meta Platforms (formerly Facebook) announced results on Wednesday that were better than analysts’ expectations. However, what most contributed to the price increase of as much as 23% on Thursday were rising growth projections, lower-than-expected expenses, and the announcement of a buyback of its shares at the value of even 40 billion USD!
On Thursday evening, tech giants Apple, Alphabet (Google), and Amazon announced the results. Apple missed revenue, profit, and sales expectations for many of its lines of business last quarter, sending shares lower in extended trading. Apple’s sales for the holiday quarter were about 5% lower than last year, the first year-over-year decline since 2019.
Apple CEO Tim Cook said three factors influenced the results: a strong dollar, manufacturing issues in China affecting the iPhone 14 Pro and iPhone 14 Pro Max, and the overall macroeconomic environment, which is sure to punish the market with a big drop in stock price during today’s day.
Alphabet narrowly missed expectations for revenue, and earnings per share, the miss coming as revenue in its core advertising business was hurt by advertisers cutting advertising costs and being wary of a weaker economy. Advertising revenue fell to $59 billion in the fourth quarter from $61.24 billion in the year-ago period, while YouTube advertising revenue fell to $7.96 billion from $8.63 billion. Google Cloud revenue jumped to $7.32 billion from $5.54 billion in the same year.
Amazon beat revenue expectations for the fourth quarter, but revenue from its cloud business, Amazon Web Services, was slightly weaker than expected. Revenue of $149.2 billion was 8.5% higher than in the fourth quarter of 2021 and higher than the $145.7 billion expected by analysts. Revenue from AWS (cloud segment) was $21.4 billion, which is 20% higher than the previous quarter but slightly less than the expected $21.9 billion.
American indices have registered a particularly strong increase since the start of the year, which was also predicted, so the S&P500-index increased by 9.30%. At the same time, the Nasdaq Composite Index, which mainly tracks technology companies, jumped as much as 17.46%.