New York, April 29, 2026, 19:01 EDT
U.S. stocks diverged in after-hours moves Wednesday. Alphabet surged, lifted by strong cloud-driven earnings. Shares of Meta, Amazon, and Microsoft retreated as Wall Street weighed the cost of their AI investments. Earlier, the Dow dropped 0.57%, the S&P 500 edged 0.04% lower, and the Nasdaq managed a 0.04% gain.
The timing isn’t trivial—these weren’t just another batch of earnings. Microsoft, Alphabet, Amazon and Meta together account for more than $10 trillion in market cap, representing roughly 17% of the S&P 500. Their capital expenditures — think data centers, chips, anything long-term — are projected to hit $600 billion this year. Horizon Investment Services CEO Chuck Carlson put it bluntly: they’re “the straw that stirs the drinks” for big index funds. And BCA Research’s Noah Weisberger says investors are watching for that spending to start fueling revenue growth “somewhere in the next couple of quarters.” Reuters
It was a tough setup. The Federal Reserve kept its key rate parked at 3.50%–3.75%, flagged “elevated” inflation—global energy prices a big part of that—and called out growing uncertainty from the Middle East. Reuters noted an 8-4 split: three officials resisted a tilt toward easier policy, a signal that cutting rates looks more likely than hiking, while one member went straight for a cut. Federal Reserve
Alphabet delivered for the bulls. The Google parent’s first-quarter revenue climbed 22% to $109.9 billion, with Google Cloud posting a 63% surge to $20 billion—marking the strongest growth for the cloud segment since Alphabet began disclosing those numbers in 2020. CEO Sundar Pichai pointed to “enterprise AI solutions” as the main engine behind the cloud’s gains. The stock jumped more than 7% after hours. Reuters
Microsoft’s results didn’t quite match the buzz. Azure’s cloud revenue climbed 40%, right on target, but the stock slipped more than 2% after hours as investors measured those gains against the quicker pace at Google Cloud. “The market wanted to be wowed,” said Rebecca Wettemann, CEO of Valoir. Melissa Otto, head of research at S&P Global Visible Alpha, added that it was “not a blow-away quarter.” Reuters
Amazon topped expectations in its cloud business, with AWS revenue climbing 28% to $37.6 billion. Net sales hit $181.5 billion. Still, shares slid roughly 3.7% after Amazon posted an operating income outlook that ran wider than Wall Street was looking for, and quarterly capex hit $44.2 billion. Jesse Cohen, senior analyst at Investing.com, flagged AWS growth as “the standout story.” Gil Luria at D.A. Davidson said AWS might see “a slight disappointment” compared to the much faster expansion from Google Cloud. Reuters
Meta posted a clear revenue beat, yet the shares took a more than 6% dive after hours. The company, which owns Facebook and Instagram, bumped up its 2026 capex range to $125 billion–$145 billion from the earlier $115 billion–$135 billion. Revenue came in at $56.31 billion, marking a 33% jump. Mark Zuckerberg called it a “milestone quarter.” Luria, though, said the performance simply “met expectations” and didn’t stack up to Google. Reuters
Investors are juggling a pair of tricky variables here: accelerating AI-driven revenue and rising costs across the board. Oil pushed close to $120 a barrel. Bond yields climbed. After the Fed’s move, stocks dropped. That old dilemma hung in the air—robust tech earnings can only do so much against the weight of energy prices and higher rates.
Beyond the big tech names, gains were hard to find in the regular session. Energy was the standout among S&P 500 sectors, but utilities and materials trailed. Robinhood dropped 13.2% after missing on profits, while NXP Semiconductors jumped 25.5% thanks to a strong outlook. Starbucks added 8.5%, Visa was up 8.3%.
Thursday’s session sets up a clear test: can Alphabet’s unexpected strength in cloud lift the AI trade, or will investors zero in on Meta’s heftier capex, Microsoft’s Azure just matching expectations, and the Fed’s reminder that inflation still lingers.
