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Microsoft and Alphabet earnings, Fed decision ahead - what's moving markets -- Microsoft and Alphabet are scheduled to unveil their quarterly earnings, with the results likely to set the tone for upcoming numbers from other tech sector titans. Meanwhile, the Federal Reserve gears up to start a highly-anticipated policy meeting and China's government vows to roll out measures to reignite the country's flagging economic recovery.

1. Microsoft, Alphabet to report

Microsoft (NASDAQ:MSFT) and Google-owner Alphabet (NASDAQ:GOOGL) are set to post their latest earnings after the close of U.S. trading on Tuesday, kicking off two weeks of results from big-name technology firms.

For both Microsoft and Alphabet, attention will likely center around their cloud computing businesses. The units have been consistent cash cows for both companies, although performance has suffered in recent quarters as economic uncertainty convinces many customers to rein in spending.

The weakness may have extended into the April to June quarter, according to analysts cited by Reuters. Microsoft Intelligent Cloud, the group's biggest revenue driver and home to its Azure public cloud computing platform, is seen expanding at its slowest rate since 2017 during the period. Alphabet's own cloud computing unit, meanwhile, is expected to slip to its lowest growth ever.

But some analysts say that the pressure on cloud computing may be waning, noting that many clients are beginning to figure out how to operate in a softer macroeconomic environment.

Elsewhere, generative artificial intelligence, which has driven a surge in tech stocks this year, will remain in the spotlight. The focus will be on how Microsoft and Alphabet, as well as rivals Amazon (NASDAQ:AMZN) and Facebook-owner Meta Platforms (NASDAQ:META), plan to generate revenue from their AI offerings.

Meta Platforms is due to report its latest earnings on Wednesday and Amazon on Aug. 3.

2. Futures mixed ahead of earnings, Federal Reserve decision

U.S. stock futures were mixed on Tuesday as investors prepared themselves for a series of fresh corporate earnings and a key policy decision from the Federal Reserve.

By 05:12 ET (09:12 GMT), the Dow futures contract slipped by 3 points or 0.01%, S&P futures added 7 points or 0.16%, and Nasdaq 100 futures gained 61 points or 0.39%.

The 30-stock Dow Jones Industrial Average climbed to its eleventh straight winning session on Monday, while the benchmark S&P 500 and tech-heavy Nasdaq Composite also rose.

Aside from Microsoft and Alphabet, Verizon (NYSE:VZ), General Electric (NYSE:GE) and General Motors (NYSE:GM) will also unveil results before the bell Tuesday.

Several stronger-than-expected second-quarter returns have helped to fuel hopes that the U.S. economy will engineer a soft landing in the face of surging interest rates. The Fed is widely forecast to increase borrowing costs by another quarter percentage point on Wednesday, while Wall Street will also be keeping a close eye on comments about the broader economic outlook from the central bank's chair Jerome Powell.

3. Fed to kick off two-day meeting

Fed policymakers will begin their closely-watched two-day meeting on Tuesday with markets already largely pricing in a 25-basis point interest rate increase later this week.

According to's Fed Rate Monitor Tool, there is currently a more than 98% chance that the bank will lift interest rates to a new range of 5.25% to 5.50% following the conclusion of its latest gathering on Wednesday.

The near-consensus projections could lend additional importance to remarks from Powell. In particular, observers will be on the lookout for any signals that the Fed could be planning to bring its long-standing policy-tightening campaign to a halt.

Crucially, recent data has pointed to a softening in inflation, which had been the main driver behind the Fed's historic string of rate rises. But with uncertainty still surrounding how price growth will evolve over the coming months, there remains the possibility that the Fed could retain the flexibility to hike rates further if necessary.

4. China promises economic support measures

The decision-making body of China's ruling Communist Party has pledged to step up measures aimed at reinvigorating a post-COVID recovery that it described as "tortuous."

Growth in the world's second-biggest economy slowed substantially in the second quarter as its biggest drivers -- manufacturing and real estate -- remained under pressure.

In response, Beijing will adjust its policy to help boost domestic demand, support confidence and prevent risks, state news agency Xinhua reported, citing the 24-member politburo. These changes would also aim to "stabilize" foreign trade, the politburo was quoted as saying following a Monday meeting chaired by President Xi Jinping.

Chinese shares rallied on Tuesday following the news, with technology and property stocks posting particularly strong gains.

5. Oil holds firm after China support pledges

Oil prices stabilized near three-month highs, with traders digesting China's plans for more stimulus measures and signs of tight supplies ahead of the Federal Reserve policy-setting meeting.

U.S. inventory data are also in focus. Industry numbers from the American Petroleum Institute are due out on Tuesday, followed on Wednesday by the official figures from the Energy Information Administration. Stockpiles are expected to have fallen by over 2 million barrels in the week to July 21, indicating steady demand in the world’s largest oil consumer.

At 09:12 ET, the U.S. crude futures traded 0.27% lower at $78.53 a barrel, while the Brent contract dropped by 0.34% to $82.20 per barrel.

Both benchmarks climbed by more than 2% in the previous session, touching their highest closing levels since April.

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