by Daniel Shvartsman
Investing.com - Wednesday trading saw the market continue its recovery from the volatile start to the trading year, with the S&P 500 finishing up nearly 1% and the Nasdaq up .5%. Alphabet (NASDAQ:GOOGL)'s knock-out report the prior evening gave the market hope that the tech sector's outsized growth had legs left to it in the emerging post-pandemic environment.
That flipped after-hours on Wednesday, as Meta Platforms' (nee Facebook (NASDAQ:FB)) report missed numbers and offered a meager 3-11% revenue growth guidance for Q1. The miss and weak guidance sent shares down over 20%, with knock-on effects to Twitter (NYSE:TWTR) (down 9%), Snap (NYSE:SNAP) (down 17%), and Pinterest (NYSE:PINS) (down 9.5%). And the pain in tech wasn't confined to social media: Spotify (NYSE:SPOT) also dropped 12% after an underwhelming Q1 guidance, and Qualcomm (NASDAQ:QCOM) was off 2% as of this writing despite a beat-and-raise.
All of which sets the table for an interesting Thursday of earnings, with the last of the FAANG group to report earnings as well as another social media play and several important industrial companies reporting.
Here are three things to watch in markets tomorrow:
1. Amazon) and Snap earnings
Amazon (NASDAQ:AMZN) has been the lagging mega-tech company, with its most recent earnings report already reflected the hangover from the pandemic-fueled growth surge of 2020. The e-commerce and cloud computing giant is expected to post $137.75B in revenue, which would be 9.7% above 2020's number. They are also expected to guide to $121B in revenue for Q1 2022, which would mark 12% growth over the year prior. Having digested their growth slowdown already - shares are flat since July 2020 when counting that the stock is down 3.5% in the wake of Meta's report - the question is what's priced in and if Amazon is at the reacceleration point yet.
Snap, meanwhile, also reports after the bell, with analysts expecting $1.2B in revenue, good for 31% growth, as well as guidance for of roughly $1B in Q1 revenue, also good for 31% year over year growth (Snap is still expected to post earnings losses). Shares are off 69% from 52-week highs as Snap has already reported the IDFA headwinds that Meta touched on in their Q1 guidance, but that doesn't mean a miss would be received kindly.
2. Industrial earnings
Several major industrial, medical, or energy players report earnings before the bell. With tech showing signs of slowing as pandemic-related tailwinds fade, these earnings will give a snapshot into the industrial side of the economy as well as more direct supply chain and inflation readthroughs.
Honeywell (NASDAQ:HON), Illinois Tool Works (NYSE:ITW), Roche Holding Ltd ADR (OTC:RHHBY), Eli Lilly (NYSE:LLY), Merck & Co, Shell (LON:RDSa), Cummins (NYSE:CMI), ConocoPhillips (NYSE:COP), and Cigna (NYSE:CI) are all among the reporters before the bell tomorrow.
Stay up-to-date on all of the upcoming earnings reports by visiting Investing.com's earnings calendar
3. Jobless Claims
While jobless claims have drifted towards 50-year lows in recent months, the numbers have been elevated over the last three weeks, perhaps a reflection of Omicron related slowdowns. With today's ADP jobs number surprising to the downside with a meaningful drop in payrolls, tomorrow's report could be a last key data point before the U.S. nonfarm payrolls report on Friday, and also closely watched amid expectations of Federal Reserve rate hikes in March.