Investing.com — Market Update

With earnings in full swing and the U.S. election on the horizon, market discussions are heating up. Here are Investing.com’s stocks of the week:

Big Tech (Earnings): Microsoft Disappoints, Amazon Up

Microsoft (NASDAQ:MSFT) reported its quarterly earnings on Wednesday, beating earnings and revenue expectations. However, its stock fell over 6% the next session due to concerns about slowing growth attributed to supply chain issues affecting AI capabilities.

Analysts at BMO Capital noted, "While Azure growth for the September quarter was slightly above guidance, we believe investors may be disappointed with the December revenue forecast due to supply/demand imbalances. We are modestly lowering our target price to $495 while retaining our Outperform rating."

In contrast, Amazon (NASDAQ:AMZN) shares surged by 6.7% on Friday following an earnings and revenue beat, aided by improved retail sales. Citi analysts expressed increased confidence in Amazon’s ability to invest in growth while expanding margins. They highlighted retail efficiency improvements that lower costs and enhance delivery speed, positively impacting conversion rates and overall spending.

Apple (NASDAQ:AAPL) also released earnings this week, exceeding expectations, but its stock dipped on Friday due to disappointing guidance.

SMCI

Super Micro Computer, Inc. (SMCI) experienced a rough week, plummeting over 32% on Wednesday after Ernst & Young LLP resigned as its public accounting firm. The resignation led to significant concern regarding the company’s financial statements. Following the news, Rosenblatt suspended its rating on the stock, citing financial uncertainty.

SMCI shares have dropped more than 41% over the past week.

Estee Lauder (NYSE:EL)

Estee Lauder also faced challenges, plummeting 20% on Thursday and continuing to decline on Friday after reporting a revenue miss and withdrawing its fiscal 2025 outlook due to difficulties in China and travel retail. The company announced a cut to its quarterly dividend, and JPMorgan downgraded Estee Lauder to Neutral, lowering its target price from $113 to $74.

JPMorgan stated, "We don’t expect visibility for at least another three months, and given lower volumes in China and Asia Travel Retail, we advise investors to wait for clearer improvement signs in demand."