Technology

The big mega techs will dominate this week in the US reporting season and while investors refused to look beyond Netflix after the streaming giant reported a surprise dip in US subscriber numbers and the lowest growth in new paying customers for three years, a stumble by one or more of this week’s reporting groups could knock the market sideways.

Friday saw the changing of the guard at the top of the list of most valuable US companies confirmed after shares in Microsoft surged into record territory Friday and pushed the veteran software giant’s market cap above the $US1 trillion mark.

Nasdaq plunged into correction territory on Monday after the US government started targeting the big four tech stocks – Amazon, Apple, Facebook and Google (Alphabet).

The response in time is likely to be more regulation.

A major about-face on maintaining its dividend payout and a loss in the latest full-year results from London based telco, Vodafone Group PLC help explains why the company wants to abandon Australasia through sales of its operating arms in Australia and NZ.

Warren Buffett’s Berkshire Hathaway is expanding its involvement in the megatechs. First, it was Apple where Berkshire is the third biggest investor. Now the company has dipped its toe into the share register of Amazon.

Microsoft may have topped the $US1 trillion valuation level but the real tech star – in fact the real US corporate star remains Amazon which blew past all profit forecasts in an ominous sign for its rivals.

Apple’s December quarter results were a little better than expected after the dramatic warning of January 2, but the company’s outlook for the current March three month period fell short of forecasts with a possible shortfall in revenue of up to $US6 billion.

Could this be the decisive week for US 4th quarter earnings and perhaps the immediate outlook for the American economy, even though President Trump threw in the towel on the weekend and called off his government funding shutdown?

At the third attempt in five days, Microsoft has finally regained the mantle as the world’s most valuable company from Apple.

For the second time in as many days, Microsoft has briefly regained the mantle as the world’s most valuable company from Apple.

Apple is no longer a $US1 trillion company – in fact, at Monday’s close it is now a $US958 billion company – and its rival and brief fellow member of the trillionaire club, Amazon is now just a $US814 billion company.

Apple’s market value unofficially fell under the $US1 trillion level in after-hours trading on Friday as investors continued to sell off the stock in the wake of the weak December quarter outlook.

Now that’s not what the market really wanted to hear from Apple in its Q4 earnings report and outlook for the crucial December shopping period, no real growth in sales and at best a marking time.

Apple’s quarterly results will dominate markets in the US and around the world this week with a lot at stake – including its continuing role as America’s (and the world’s) most valuable listed company, not to mention the impact of the report on fragile investor sentiment.

Don’t rely on the forthcoming tech stocks reports to steady the ship on Wall Street. At best they might force investors to think again if the numbers are above estimates.

October is shaping up to be a brutal month for shares with the S&P falling 8.9% month-to-date, the Dow down 7.1%, and the Nasdaq falling 11.7% since the start of the month.