Big earnings from Microsoft, Alphabet, and Boeing, dollar drops ahead of the Fed, oil rises

US stocks are mixed ahead of the FOMC decision and Apple’s results.  The Dow Jones Industrial Average is leading the decline following Boeing’s lackluster earnings report and a disappointing cancer drug study from Amgen.

Much of today’s attention stayed with Alphabet’s superb results, Microsoft’s strong quarter that didn’t impress, and Boeing’s challenges.  Wall Street needs to see how much Apple crushes this earnings report and if they deliver another stock buyback plan and boost their dividend.  For the S&P 500 index to continue making fresh record highs, the Fed needs to remain optimistic but eternally dovish and Apple needs to deliver.



Alphabet was a favorite trade early in the pandemic, but now it is also benefiting from the reopening of the economy.  A strong beat with both the top and bottom line (EPS USD26.29 v USD15.64 estimate and Rev USD55.31 billion v USD51.61 billion estimate) was also accompanied with strong revenue growth across all divisions:

–  Google Segment Revenue USD51.2B v USD38.2B y/y

– Google Network Members’ properties Revenue USD6.8B v USD5.2B y/y

– Google ad Revenue USD44.7B v USD33.8B y/y

– YouTube ad Revenue USD6.0B v USD4.0B y/y

– Google Cloud Revenue USD4.0B v USD3.99B estimate and USD2.78B y/y

Google noted an uptick in travel booking via Google search and that should complement the optimism for leisure and hospitality jobs to return by the end of summer.  Businesses that want to be successful with the reopening of the economy will likely go big in the next couple quarters on digital marketing and that is good news for Google.

Google is betting big on cloud and getting to profitability might take some time (competition is tough with Azure and AWS).

This type of earnings report and share buyback announcement will make analysts have to upgrade their price targets and could flip the few sell ratings to buy.  Taxes remain a big concern, but that should not derail investors initially as Google is becoming best of breed for the mega-cap tech investments.


The bar was too high for Microsoft and investors decided to tentatively head for the sidelines despite a ninth straight quarter of beating analysts’ expectations on profit and revenue.  Microsoft stock has been skyrocketing during the pandemic and became excessively deep in overbought territory.  Azure growth remains strong, but concerns are creeping in that the competition may start to stunt future cloud growth.


Boeing’s first quarter results reminded investors that their recovery will be long and filled with many hurdles.  The aerospace giant still has a messy couple of quarters ahead.  Boeing’s cash burn was much worse than expected on struggles with Dreamliner deliveries and a slow resumption of the 737 Max.  Boeing also took a big USD318 million loss that stemmed from problems at a supplier in the program to replace Air Force One jets.  Boeing’s first-quarter posted a core loss of USD1.53, worse than the expected 0.90 dollar decline, while revenue came in better than expected at USD15.2 billion, but still down 10% from a year earlier.  It looks like Wall Street wants to own Boeing stock much later until some of these hurdles are long gone.


The dollar is weakening ahead of the FOMC decision on some month-end rebalancing flows and mostly upbeat comments from ECB president Lagarde.  Lagarde noted that the risks to the short-term outlook are to the downside.  US Trade Chief Tai also reminded investors of a laundry list of trade issues with neighbors, Europe and China.  Wall Street is not yet worried that a review of the USMCA, Phase-One trade deal with China, and Europe’s aircraft subsidy dispute will lead to any harsh actions from the Biden administration.


Crude prices rose after the EIA report showed some optimistic signs that demand is improving and as US production dips.  The headline build of 90,000 barrels was quickly shrugged off as energy traders-focussed refiners got busy ahead of the summer driving season.  A massive drawdown of 5.0 million barrels in PADD 3 suggests demand outlook is about to start looking a lot better.

Oil also got some support after the dollar reversed earlier gains on mostly upbeat comments from ECB’s Lagarde and a steady approach on trade from US trade representative Tai.

The path higher still seems to be higher for oil prices as crude demand should steadily increase across the US and Europe this summer.

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Ed Moya

Ed Moya

Contributing Author at OANDA
With more than 20 years’ trading experience, Ed Moya was a Senior Market Analyst with OANDA for the Americas from November 2018 to November 2023. His particular expertise lies across a wide range of asset classes including FX, commodities, fixed income, stocks and cryptocurrencies. Over the course of his career, Ed has worked with some of the leading forex brokerages, research teams and news departments on Wall Street including Global Forex Trading, FX Solutions and Trading Advantage. Prior to OANDA he worked with, where he provided market analysis on economic data and corporate news. Based in New York, Ed is a regular guest on several major financial television networks including CNBC, Bloomberg TV, Yahoo! Finance Live, Fox Business, cheddar news, and CoinDesk TV. His views are trusted by the world’s most respected global newswires including Reuters, Bloomberg and the Associated Press, and he is regularly quoted in leading publications such as MSN, MarketWatch, Forbes, Seeking Alpha, The New York Times and The Wall Street Journal. Ed holds a BA in Economics from Rutgers University.