Microsoft
delivered the inventory market a truck full of lemons this past week. Traders selected to see a tanker crammed with lemonade. It’s a optimistic signal forward of a very powerful week for fourth-quarter tech earnings.
We’ve come a good distance. In 2022, tech stocks were crushed, because the Federal Reserve aggressively lifted rates of interest. A month into 2023, the Fed appears nearer to the top of its tightening cycle than the start, however solely now are we seeing these larger charges start to sluggish demand for tech items. The result’s that company earnings for the subsequent few quarters could possibly be ugly. If 2022 was all about decreased worth/earnings multiples as charges ratcheted larger, 2023 will likely be all about decreased “E,” as demand contracts.
