Hope Is Still Alive for Lower Rates: 31 July 2024
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Market Mood
The U.S. labor market is cooling but not yet cold, with nonfarm payrolls likely rising by 225k in July, up from 206k in June, and unemployment expected to remain at 4.1%. Average hourly earnings are anticipated to increase by 0.3% month-over-month. Microsoft's (MSFT) fiscal fourth-quarter earnings report, released after Tuesday's close, highlighted expected growth in the Azure cloud segment, capital expenditure trends, and returns from AI investments. Microsoft's earnings per share were $2.95, with revenue up 15.0% year-over-year to $64.4 billion. Apple (AAPL), set to release its fiscal third-quarter results after Thursday's close, is anticipated to report earnings of $1.34 per share (+13.6% YoY) on revenue of $84.4 billion (+10.4% YoY) for the June quarter. Investors will be closely watching China's results, services growth, and guidance for the September quarter, which could indicate early expectations for the iPhone 16 launch. While China sales were likely subdued in the June quarter, services are projected to grow by 13% year-over-year.