Super Thursday is here, the Federal Reserve performs "Powell's Last Dance"

Within a single day, Wall Street must digest four tech giants’ earnings reports and multiple interest-rate decisions—this day is known in the market as “the most important earnings day in recent years.”

On April 29 (Eastern Time) (the early morning to morning hours of April 30 Beijing time), Alphabet (Google), Amazon, Meta, and Microsoft will release their quarterly results in a concentrated manner after the market close on the same trading day. At the same time, the U.S. Federal Reserve’s FOMC will end its two-day meeting and announce its interest-rate decision, and Fed Chair Jerome Powell will also host what is his last press conference during his current term. The Bank of England and the European Central Bank will also publish their latest interest-rate decisions on the same day.

Matt Stucky, Chief Investment Officer at Northwestern Mutual, described this day as “one of the most important earnings days in recent years.” The combined market value of the four companies is about $11.6 trillion, accounting for more than 19% of the S&P 500 index—any performance fluctuation from any one of them is enough to move the broader market.

Since recent lows, the S&P 500 index and the Nasdaq have rebounded by roughly 11% and 18%, respectively. Funds have flowed back into technology and data-center-related sectors. The core narrative behind this rebound is the continued expansion of AI investment. This earnings season will be a key test of whether that narrative can continue.

Thursday’s schedule at a glance, table: Wall Street journal

A $650 billion AI bill—what the market wants is returns

This year, the four companies’ combined capital expenditure budget is as high as $650 billion: Google’s guidance is $175 billion to $185 billion, Meta $115 billion to $135 billion, Amazon about $200 billion, and Microsoft’s capital expenditures already reached $37.5 billion in the prior quarter alone.

Money is still pouring in, but the market’s patience is narrowing.

Bernstein analyst Mark Shmulik wrote in a research report last week that these four mega-scale cloud providers need to do three things at the same time: deliver AI-driven revenue that exceeds expectations, keep their capital expenditure budgets from shrinking, and demonstrate cost control through layoffs or pricing power. “Overall, the picture entering earnings season is remarkably clear and consistent.”

Citizens analyst Andrew Boone told MarketWatch, “The entire AI ecosystem is currently constrained by supply”—infrastructure and energy are insufficient to meet computing-power demand. Therefore, all four companies need to prove that they can put data-center capacity into use quickly enough to absorb backlogged orders. “Part of the issue is who can execute well enough to truly translate capital expenditures into reality.”

Signals from the demand side remain strong. Boone pointed out that since 2026, demand for computing power has risen rapidly: Anthropic has signed a batch of new agreements to expand access to AI infrastructure; Amazon announced it will provide Meta with tens of millions of custom Graviton chips; and Google disclosed at last week’s Google Cloud Next conference that the number of tokens its models process per day has increased from 10 billion in the previous quarter to 16 billion.

Each company faces different pressures, with Microsoft in the most delicate spot

Google’s pressure is mainly on the cost side. The company has previously warned that its depreciation growth will accelerate in the first quarter and will rise noticeably across the full year. What the market cares about is not whether Google will continue to invest, but whether cloud business and AI-related revenues can digest that spending more quickly.

Meta’s thesis is the most direct. It has the strongest advertising cash flow and also the most aggressive infrastructure investment. The company has made clear that its capital expenditures in 2026 will rise to $115 billion to $135 billion, but full-year operating profit will still be higher than in 2025. After the earnings are released, the market’s judgment will come quickly too: whether the profitability of the advertising business can continue to cover the pace of AI investment expansion.

Amazon’s problem is not only that it invests heavily, but also that once the money is spent, the realization has to be looked at later. CEO Andy Jassy explicitly stated in the shareholder letter that most of the cloud-business capital expenditures in 2026 will be gradually monetized from 2027 to 2028. In 2025, AWS added 3.9 gigawatts of power capacity, and it is expected that total capacity will double by the end of 2027, but the company still admits there is capacity constraint and unmet demand. This time, the market will pay particular attention to how management discusses customer commitments, capacity ramp-up, and the cadence of monetization.

Microsoft is in the most delicate situation of all. Matt Stucky believes that among the four companies, Microsoft has the highest risk. Last quarter’s Azure cloud growth disappointed the market, and the enterprise adoption rate of Copilot was also below expectations. Its stock is down 12% year-to-date, the worst performance among the four. Guggenheim analyst John DiFucci estimates that Wall Street’s expectation for Azure growth in the current quarter is about 38%, but in a research report last week he wrote, “This expectation implies that new business growth would need to jump significantly, which seems unlikely.”

Stucky said that the adoption trend of Microsoft Copilot will determine the market sentiment for the entire software sector in the current quarter.

Funds flowing back into technology, data centers, and related infrastructure

Powell’s “final curtain call”—rate expectations have already been priced in

On the same day, the Fed’s FOMC will end its two-day meeting and announce its rate decision. Currently, the market has fully priced in maintaining interest rates unchanged at 3.50% to 3.75%.

After rate cuts in the second half of 2025, the Fed paused; rising oil prices have made the inflation outlook even more complex, and the timing window for further rate cuts has shifted afterward as well.

This will also be Powell’s last press conference as Fed Chair. His chair term will end on May 15. The successor Waller, nominated by Trump, is expected to receive Senate confirmation before the Fed’s next meeting in mid-June. The biggest suspense is whether Powell will announce that after stepping down as Chair, he will continue to remain a member of the Federal Reserve Board.

Geopolitical risks: The Hormuz Strait affects the AI supply chain

Geopolitical developments add an extra variable to this day. A blockade of the Hormuz Strait directly impacts global energy flows and supply chains, and data-center supply chains are also affected.

Moody’s analyst Terrence Dennehy specifically pointed out in a research report last week that conflicts in the Middle East pose “supply risks” for the helium market. “Helium is critical in multiple stages of semiconductor manufacturing—including cooling, carrier gas usage, and leak detection—and there are no effective substitutes,” Dennehy wrote.

Northwestern Mutual’s Stucky also said it cannot be ruled out that the four companies may further raise their capital expenditure forecast, which could trigger a new wave of market concerns about excessive AI investment.

After earnings—how the market will price it

This earnings season is more like a screening point rather than an on-off switch.

Wall Street Journal mentioned that the main storyline of AI currently shows no signs of ending, and capital is still flowing in. But the market’s pricing logic is diverging: companies that can realize results faster, have firmer orders, and more stable profits will continue to receive a premium; companies that invest heavily but have an unclear path to returns will see more pronounced stock price volatility.

In the industrial chain of semiconductors, servers, network equipment, and data-center equipment, it still most directly follows the spending by major manufacturers. Recently, software and chips have already moved toward differentiation, indicating that the market is starting to concentrate more toward areas closer to orders and infrastructure. If the four companies’ earnings continue to confirm strong demand and capital expenditure intensity, this differentiation will become even more evident.

On the day of the earnings releases, the market’s key questions are: whether full-year capital expenditure guidance will be raised again, whether cloud business growth can continue to accelerate, whether AI-related revenue will be disclosed more clearly, and whether profit margins and cash flow will face more obvious pressure.