Morning bid: Tech tonic, recession rethink

A look at the day ahead in U.S. and global markets from Mike Dolan.

Pumped-up hopes for U.S. tech sector earnings in a heavy week for corporate updates generally have twinned with the latest sign Europe may have dodged a winter recession.

With Microsoft (MSFT.O) topping the U.S. company reports on Tuesday and Tesla (TSLA.O) due later this week, Monday's impressive Wall St <S&P500> rally was driven by a combination of chip sector ebullience and confidence the Federal Reserve will dial down the size of its interest rate hikes again next week.

Philadelphia SE semiconductor index (.SOX) jumped 5% on Monday as analysts upgraded the industry, making it the biggest one-day gain since November. The S&P500 jumped 1.2% and futures held nearly all those gains ahead of busy Tuesday.

With Microsoft in view, attention will be on the extent for cost cutting and job shedding in the tech and digital space. Music-streamer Spotify (SPOT.N) rose 2% on Monday as it joined a growing list of tech firms to announce staff cuts, shedding 6% of its workforce.

Reports of Ford's F.N plan to cut 3,200 workers in Europe shows job attrition may not be confined to tech sector.

But Microsoft stock gained too on Monday too after it announced another multibillion dollar investment in OpenAI, deepening ties with the startup behind the chatbot sensation ChatGPT.

Tesla jumped 7.7 % ahead of its earnings on Wednesday and as Chief Executive Elon Musk took the stand in a fraud trial related to tweets saying he had backed taking the electric automaker private.

After a year of conflict in Ukraine and military tensions surrounding Taiwan, 2022's outperforming U.S. defence stocks ...
[Short citation of 8% of the original article]