Google and Tesla kick off M7 earnings season, Powell appears under heavy pressure, ECB releases latest interest rate decision【The week ahead】

TradingKey - The US stock market showed an overall trend of oscillating upward last week. The Nasdaq Composite Index and the S&P 500 Index hit record highs twice within 5 trading days. This week, the US stock market will enter the peak of the earnings season. It is expected that more than 100 S&P 500 components will release earnings reports. Google (Alphabet) and Tesla will become the focus of attention. Coca-Cola and General Motors will also reveal the latest impact of tariffs on the US business community. Powell, who has been repeatedly pressured by the White House recently, will also deliver a speech at a conference. This Thursday, the European Central Bank will hold a monetary policy meeting. After eight interest rate cuts, the eurozone policy interest rate has now stabilized at 2%.

Preview of major events

Google (Alphabet), Tesla (TSLA) kick off M7 earnings season

The next two weeks will be the core of the earnings season for US tech giants. After the US stock market closes on July 23, Google's parent company Alphabet (GOOG) will release its Q2 2025 financial report. Tesla will release its Q2report on the day before the market opens.

The market generally expects Google's revenue to be US$93.9 billion, an increase of 11% year-on-year. Earnings per share (EPS) is expected at US$2.17, an increase of 15% year-on-year. According to market expectations, Tesla's second-quarter revenue is expected to be US$22.83 billion, a year-on-year decrease of 10.46%; adjusted net profit is expected to decline more than 15% to US$1.533 billion; earnings per share are expected to be at US$0.43, shrinking 17.46%.

The ECB will announce its latest interest rate decision on Thursday

The European Central Bank will announce its latest interest rate decision on Thursday, and the market generally expects that the pace of rate cuts will be temporarily paused. After eight rate cuts, the eurozone policy rate has now stabilized at 2%. The minutes of the June ECB meeting pointed out that the profit margins of eurozone companies have been squeezed recently.

It is reported that the ECB will discuss a more negative situation this week than expected in June after Trump's latest trade tax threats. The ECB is still expected to keep interest rates unchanged at its meeting on July 24. Discussions on rate cuts have been postponed to September.

US President Trump will deliver a speech on the artificial intelligence industry

US President Trump plans to deliver a major speech next week to outline his vision for the development of artificial intelligence (AI) and propose strategies to ensure that the United States maintains global dominance in this field.An unnamed government official stated that the speech will provide a comprehensive introduction to the AI action plan soon to be released by the Trump administration.

The action plan is a policy task initiated by Trump's executive order signed within days of taking office in January this year, and is now in the final stage of finalization. The plan was led by Sacks and White House technology adviser Michael Kratsios, and widely absorbed the opinions of the industry. The plan is expected to be released at the end of this month, and Trump will then sign a new executive order to promote its specific policies.

Fed Chairman Powell to deliver remarks at a regulatory conference

On the 22nd, Fed Chairman Powell will deliver a welcome speech at a regulatory meeting, which is also a rare "live speech during the silent period". The market has basically priced in that the Fed will not cut interest rates at the meeting at the end of this month, but Trump's dissatisfaction with Powell has intensified in recent days, and he has been putting pressure on the Fed to "cut interest rates now". 

Some analysts believe that the market’s reaction may make the government realize that firing Powell is not a cure-all for the economy and the markets. However, there are also views that the market’s performance before Trump’s denial was not that bad, which might encourage him to take another step in the future. The market’s tolerance window has been widened — for investors, this marks the beginning of a worse scenario.

Selected Economic Data

Wednesday: U.S. June existing home sales (10,000 households)

Thursday: Eurozone deposit facility rate of the European Central Bank until July 24

Friday: U.S. June durable goods orders monthly rate

This week's featured events

Tuesday: Federal Reserve Chairman Powell to deliver a welcome speech at a regulatory conference.

Wednesday: U.S. President Trump to speak at an event called "Winning the Artificial Intelligence Race."

Thursday: European Central Bank President Lagarde to hold a monetary policy press conference.

Company Financial Report

Monday: Coca-Cola (KO.N), General Motors (GM.N), Texas Instruments (TXN.O)

Tuesday: AT&T (T.N), Alphabet (GOOGL.O), Tesla (TSLA.O), IBM (IBM.N)

Wednesday: Intel (INTC.O)