Morning Wrap: Record-breaking Big Tech Results Driven by AI, Fed Delivers No Surprises

Date: April 30, 2026

Market Overview

Yesterday's Wall Street session concluded with a mixed and cautious sentiment as investors prepared for earnings reports from major tech companies, referred to as the "Mag7." The S&P 500 experienced a slight decline, while the Nasdaq saw a minor increase, and the Dow Jones fell by nearly 0.6%.

Tech Earnings Highlights

Options markets indicated significant expected volatility for Alphabet, Microsoft, and Meta, with potential market cap swings of around $1 trillion. Key areas of focus included:

• Microsoft: Azure growth and AI spending.
• Meta: AI investments and advertising demand.
• Alphabet: Sustaining search momentum and cloud expansion.

Alphabet Inc. (GOOGL)

Alphabet reported impressive results, with approximately $109.9 billion in revenue. The company's cloud segment, particularly Google Cloud, significantly contributed to its performance, showcasing the effectiveness of its AI investments in enhancing efficiency and profitability.

Microsoft Corp (MSFT)

Microsoft also delivered strong results, alleviating concerns regarding cloud growth and AI spending. The company reaffirmed its capability to scale Azure while maintaining robust earnings and cash flow generation.

Amazon.com Inc. (AMZN)

Amazon's results were solid, driven by e-commerce, AWS cloud services, and advertising growth. However, the market reacted cautiously due to conservative forward guidance and rising costs associated with AI and infrastructure investments.

Meta Platforms Inc. (META)

Meta reported strong earnings, with advertising demand as the primary growth driver. Despite beating expectations, the market response was muted, focusing on the increasing costs of scaling AI.

Federal Reserve Update

The Federal Reserve decided to keep interest rates unchanged, signaling a cautious monetary policy approach. There was no immediate indication of easing, and a divergence among FOMC members suggested a more data-dependent outlook moving forward. Jerome Powell confirmed he would remain at the Fed as a Governor after his term as Chair ends, ensuring continuity in leadership.

Political and Economic Developments

Donald Trump commented on the Fed's interest rate policy, suggesting it was an appropriate time for cuts due to economic conditions. He also maintained a strong stance on Iran, linking any de-escalation to concessions from Tehran while proposing an international coalition to secure navigation in the Strait of Hormuz.

As a result of stalled peace talks, Brent crude oil prices surged above $110 per barrel.

Global Economic Indicators

Chinese PMI data indicated an uneven recovery, with private manufacturing PMI rising to 52.2, the highest since 2020, while domestic demand remained weak. Japan's March data showed mixed results, with industrial production declining but retail sales showing resilience.

In currency markets, the Japanese yen weakened, with USD/JPY surpassing the significant 160 level.

Breaking News

• ECB keeps rates unchanged; EUR/USD falls below 1.1700.
• Bank of England holds interest rates steady.
• Sharp drop in USD/JPY; potential currency intervention.
• Unexpected slowdown in Eurozone economy; EUR/USD directionless.