July 20th, 2020
Netflix's disappointing Q3 guidance last week raised some questions about whether the stunning outperformance of tech and internet stocks through this year's pandemic can endure as some semblance of normality returns to the global economy in the second half of the year. The unfolding second-quarter earnings season, where Q2's actual implosion has long since been discounted, will give some insight on how companies are shaping up for recovery and this week sees some of the leading computing, tech and internet names starting to report. Microsoft, Tesla and Nasdaq itself deliver earnings updates on Wednesday. Twitter and Intel are out on Thursday. For some the sector is overcooked and higher regulation, taxes and ‘de-globalisation’ may act as reality checks. For others, this remains a long-term play about the transformation of the modern economy that this year's pandemic has merely catalysed.
Chart by Ritvik Carvalho and commentary by Mike Dolan.
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