### Anticipation Builds Ahead of Big Tech Earnings as Apple Faces Downgrade

Investors are gearing up for potential turbulence from the upcoming US jobs report, due next Friday, and the subsequent presidential election, which is just days away. Amid this backdrop, Tesla's unexpected earnings performance has set the stage for other major tech companies, specifically those in the "Magnificent Seven," which include Alphabet (GOOG, GOOGL), Meta (META), Microsoft (MSFT), Apple (AAPL), and Amazon (AMZN), to unveil their earnings next week.

Despite a generally tough week for stocks, megacap tech companies have seen a surge in investor interest, pushing the Nasdaq Composite (^IXIC) up by approximately 0.6%. The index finished close to a record high at the closing bell on Friday, marking the only weekly gain among major indices. On the other hand, the S&P 500 (^GSPC) dipped slightly below the flat line after breaking a three-day losing streak, while the Dow Jones Industrial Average (^DJI) fell by 0.6%. Both the S&P and the Dow recorded weekly losses amid uncertainty regarding the Federal Reserve's forthcoming interest rate decision. The benchmark 10-year yield (^TNX) also climbed to around 4.23%, just shy of the three-month high reached earlier in the week.

In contrast, Apple faces some headwinds despite the general optimism surrounding its AI initiatives. KeyBanc has downgraded Apple’s stock from Sector Weight to Underweight. Analyst Brandon Nispel highlighted concerns that consumer upgrades to the iPhone 16 and overall iPhone sales may grow at a slower pace than previously anticipated. KeyBanc’s initial consumer iPhone survey indicates that sales of the more affordable iPhone SE might cannibalize potential upgrades to the iPhone 16, potentially impacting Apple's performance in the upcoming quarter.