Major indices, including the S&P 500 and Nasdaq, posted strong gains, setting the stage for potentially their best months since 2020. This rally was supported by falling oil prices and lower bond yields. Tech leaders Alphabet, Amazon, Microsoft, and Meta all significantly raised their full-year capital expenditure forecasts for AI, committing to spend a combined $695 billion. While Alphabet's stock surged, Meta's declined following its report. Attention remains fixed on Apple's upcoming earnings call, where analysts will scrutinize succession plans, AI strategy, and device sales in China.
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Major indices surged on the last day of April, with the S&P 500 hitting an all-time intraday high and the Nasdaq rallying, positioning both for their best months since 2020.
Market Performance and Drivers
The market saw significant gains, driven by favorable macroeconomic conditions and major tech spending announcements. Key market movements included:
S&P 500: Increased by over 10% for the month of April.
Nasdaq: Rallied by over 15% for the month.
Support Factors: Gains were supported by lower oil prices and declining 10-year Treasury yields, which dipped amid slower-than-expected U.S. economic growth.
Tech Giants Boost AI Spending
During a rare event where four major hyperscalers reported earnings on the same evening, they all significantly increased their full-year capital expenditure (CapEx) guidance, signaling intense investment in Artificial Intelligence (AI).
Alphabet, Amazon, Microsoft, and Meta committed to spending a combined total of at least $695 billion this year, representing an increase of over 14% from previous estimates.
The projected spending breakdown for the four companies is as follows:
Alphabet: $180 billion to $190 billion (up from $175B–$185B).
Amazon: Unchanged at $200 billion.
Microsoft: Approximately $190 billion.
Meta Platforms: $125 billion to $145 billion (up from $115B–$135B).
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Divergent Stock Reactions
Despite the collective spending boost, market reactions varied based on the company's infrastructure:
Alphabet: Shares surged nearly 10%, tracking toward another record close.
Meta Platforms: Stock fell by almost 8% following its disclosures.
Upcoming Earnings and Market Focus
Investors are closely watching for several key reports, particularly from Apple, alongside memory storage firms SanDisk and Western Digital.
Apple Earnings Watch
Apple is scheduled to report earnings after the bell. Analysts will focus on several critical areas:
Succession: Questions regarding the leadership transition following CEO Tim Cook's departure.
Strategy: Apple's future AI and hardware strategy under the new leadership.
Sales Metrics: Performance of device sales in China, reception to the new MacBook Neo, and overall services revenue growth.
Supply Chain: Whether the company can meet demand given soaring memory costs and if price hikes are anticipated to protect margins.
Other Reports
Memory Storage: SanDisk and Western Digital are expected to report results, with market attention focused on how their earnings support recent rallies driven by AI demand.
Other Names: Amgen, Stryker, and Agnico Eagle Mines are also on the evening docket.
