Breakfast News: Earnings Begin To Ramp Up

Source: Image Created by Jester AI.

1. Futures Flat as Reporting Picks up Steam

The S&P 500 looks set to open Friday flat despite the futures market falling when it reopened on Thursday evening. President Trump confirmed he would decide within two weeks what to do in relation to the conflict in the Middle East, giving time for diplomacy and boosting investing sentiment a little. The coming weeks see a pick-up in earnings releases, beginning with Kroger (KR -0.85%) reporting ahead of the market reopening this morning, with minimal revenue and earnings growth year over year expected.

• First results for interim CEO Ron Sargent: The Dividend Investor recommendation will be under scrutiny after a mixed bag of results last quarter. Investors will be watching out for growth in digital sales and the cost impact of recent wage increases as well as potential margin compression.
• Sharp 7% stock fall following the last quarterly release: Accenture (ACN -1.89%) also releases results before the market opens, with AI-led digital transformation deals a hot topic. The fall in U.S. federal spending hit the Hidden Gems rec last quarter, so any updates on delayed contracts will be noted.

2. TSMC's Possible Trillion-Dollar Project

Taiwan Semi (TSM -0.17%) could be set to team up with SoftBank Group to make a $1 trillion industrial complex in Arizona to build robots and support AI, Bloomberg reports.

• Codenamed "Project Crystal Land": Although details are still private, the plan is built around bringing high-tech manufacturing back to the U.S., leaning on the ties with SoftBank founder Masayoshi Son and President Trump, with potentially lucrative tax breaks for companies involved.
• TSMC already planning on $165 billion U.S. investment: Production has already started in Arizona in Taiwan Semi's first factory in the state, with the Crystal Land project having no bearing on existing plans.

3. Construction Bidding War Breaks Out

Home Depot (HD -0.68%) has expressed interest in purchasing GMS (GMS 10.72%), according to the WSJ, in what could start a multi-billion dollar acquisition battle with QXO (QXO 11.66%) in the construction sector.

• Unsolicited proposals indicate tactical opportunity: Both Home Depot and QXO are looking to increase their market share for construction tools and general supplies, aiming to win more wholesale business if they can boost GMS with better technology and economies of scale from a larger entity.
• GMS stock spikes over 17% in pre-market trading: GMS closed Wednesday almost 11% higher following the QXO offer, and is set to soar again following the Home Depot news.

4. Meta Hires More Talent for Superintelligence Team

The Information reports Meta Platforms (META -0.29%) is in the process of recruiting Safe Superintelligence CEO Daniel Gross and former GitHub CEO Nat Friedman, as its push to create a new superintelligence group gathers pace.

• Signing bonuses as high as $100 million: Meta tried to acquire Safe Superingelligence, an AI-start-up started by OpenAI co-founder Ilya Sutskever, earlier this year. After reportedly being turned down, CEO Mark Zuckerberg has been making offers to leading AI names with lucrative compensation packages.
• Australian social media ban moves forward: The world-leading ban on under-16s joining social media sites in Australia passed a big hurdle. A trial for digital age checks showed it can work effectively, putting pressure on Meta to ensure compliance.

5. Your Take

Accenture stock is essentially flat over the past year. It's not alone, of course. In fact, it's in good company, with the likes of Alphabet (GOOG -1.74%) little changed over 12 months. Meanwhile, the S&P 500 is up 9.25% over the same period.

Which company that you own and have high conviction in to beat the market over the next three to five years has lagged the index in the past 12 months? Explain why you retain that faith to friends and family, or become a member to hear what your fellow Fools are saying.