U.S. stock futures edged higher in early trading Thursday, as robust cloud computing results from Alphabet and Amazon buoyed market sentiment, while Meta Platforms and Microsoft faced headwinds from rising capital expenditure concerns. As of 6:46 a.m. EDT, Dow Jones mini futures were up 351 points, S&P 500 mini futures gained 13.5 points, and Nasdaq 100 mini futures added 66.25 points, according to Bloomberg data.
Key Earnings Divergence
Alphabet shares jumped 6.1% in premarket trading after the company reported a 22% revenue increase to $109.9 billion, with Google Cloud revenue surging 63% to $20 billion. CEO Sundar Pichai noted that enterprise AI solutions have become the primary growth driver for the cloud business for the first time. Amazon shares rose 1.9% after first-quarter net sales climbed 17% to $181.5 billion, with AWS revenue jumping 28% to $37.6 billion. CEO Andy Jassy highlighted that AWS's growth was the strongest in 15 quarters.
Conversely, Meta Platforms dropped 8% and Microsoft fell 1.9% as investors scrutinized their capital spending plans. Microsoft reported a 40% jump in Azure and other cloud revenue, with its AI business annual run rate exceeding $37 billion. However, the spending required to sustain that momentum weighed on shares. Meta raised its 2026 capital expenditure forecast to $125 billion–$145 billion from $115 billion–$135 billion, overshadowing a 33% revenue surge to $56.31 billion.
GDP and Inflation Data Ahead
The Bureau of Economic Analysis is set to release its advance first-quarter GDP estimate and March personal income and outlays at 8:30 a.m. EDT. The Personal Consumption Expenditures (PCE) price index, a key inflation gauge, will be included. Economists polled by Reuters expect GDP to show a 2.3% annualized gain, though consumer spending may have moderated. Boston College economics professor Brian Bethune described the environment as 'relatively slow growth mode.'
The data comes less than 24 hours after the Federal Reserve held interest rates steady at 3.50%–3.75%, noting that inflation remains 'elevated,' partly due to global energy prices. The Fed also flagged increased uncertainty from Middle East developments. Four officials dissented at the meeting, with three objecting to the statement's easing bias.
Oil Prices Add to Uncertainty
Brent crude rose 2.3% earlier Thursday as traders grew anxious about supply risks linked to Iran. Warren Patterson, head of commodities strategy at ING Economics, described the shift as moving from 'over-optimism' to 'the reality of the supply disruption.' Higher oil prices could reinforce the Fed's cautious stance, especially if PCE data runs hot.
Analysts noted that Alphabet's strong cloud results provided validation for its $180 billion capital spending plan. Thomas Monteiro, senior analyst at Investing.com, said the cloud momentum gave weight to the company's spending. Forrester principal analyst Lee Sustar added that after years of losses, Google Cloud has proven it can 'significantly contribute' to Alphabet's overall business.
Market Outlook
Traders are juggling three key factors at the open: GDP and inflation data could either soothe or stoke rate concerns; oil prices remain a wildcard; and AI-related stocks only seem to get a bid when the top line shows up in the numbers. Apple's results are still pending, with the megacap earnings story continuing after Thursday's close. Futures may not hold early gains if data disappoints or oil prices push higher, potentially reinforcing the Fed's cautious stance.
