Good morning, investors. The tech rally is back like it never left — the Nasdaq just notched its best day in six months, Google won’t stop climbing and traders seemed to have forgotten their bubble fears from a week ago.
The good news is that earnings for Big Tech look set to get stronger from here.
🚨Full Signal: My new interview with Dan Ives drops at 9 AM today. It’s a full deep-dive on the AI trade for the year ahead — subscribe on YouTube, Spotify, and Apple to tune in.
Earnings dip and bounce
Wall Street sees the Magnificent 7 stocks getting more attractive in 2026.
That’s the bet embedded in analyst expectations for Big Tech over the next 12 months.
Despite posting their weakest collective earnings growth in over two years, the group is now projected to deliver one of their most consistent acceleration cycles in years.
Earnings growth estimates continues to accelerate for the Magnificent 7 (Chart courtesy of Exhibit A)
In the third quarter, the Magnificent 7 posted 18.4% earnings growth, well below the 28.8% average of the previous four quarters, according to FactSet.
Five of the seven names beat expectations
Meta’s one-time $15.9 billion tax charge dragged the headline number
Ex-Meta, the group grew earnings 30.4% year-over-year
Meanwhile, the S&P 493 delivered 11.9% earnings growth, marking the second double-digit print for the rest of the index in three years.
Analysts keep revising earnings estimates higher (Chart courtesy of Exhibit A)
Remember, it’s forward-looking estimates that move stock prices — that in part explains why Big Tech has rallied to start the shortened Thanksgiving week.
FactSet data shows Wall Street forecasts a string of steady earnings growth for the Magnificent 7 over the next four quarters:
2025 Q4: 19.8%
2026 Q1: 18.5%
2026 Q2: 22.1%
2026 Q3: 24.5%
These companies haven’t seen this type of stair-step acceleration since the early days of the AI boom in 2022.
The rest of the market should show similar strength in the coming quarters, according to consensus estimates.
Index-level revenue growth hit 8.4% in the most recent quarter, beating estimates for 6.3%, per FactSet, with every sector except Materials surpassing expectations.
Profit estimates continue to accelerate too for large-cap tech (Chart courtesy of Exhibit A)
The technology sector posted the best revenue growth with 16%, which beat expectations of 14%.
To DataTrek Research co-founders Nick Colas and Jessica Rabe, the fact that revenues increased by a multi-year record of 8.4% is more important to stock returns than the earnings growth.
“Ask any good stock analyst and they will tell you that, everything else equal, upside revenue surprises create the highest quality earnings beats,” Colas and Rabe wrote to clients this week, noting that these results came just months after the tariff policy shock.
“We remain positive on US large caps, an opinion bolstered by the data we have reviewed here,” Colas and Rabe said.
Today’s letter is brought to you by Bitcoin IRA!
Smart investors use BitcoinIRA:
Tax Savings: When you trade in an IRA, you don't have to pay capital gains taxes that can be as high as 37%
Top-Level Security: Assets are custodied with a US based custodian and insured up to $250M²
World Class Customer Service: BitcoinIRA’s specialists will help guide you through every step of the process
P.S. As an Opening Bell Daily reader, you can earn up to $500 in rewards* when you add funds to your account.
Market snapshot
Elsewhere
📊 SF Fed President Daly sees a December rate cut. She supports lowering interest rates next month due to concerns about the job market. Her views are significant because she rarely deviates publicly from Jerome Powell. (WSJ)
📈 Alphabet is set to join the $4 trillion club. The stock jumped more than 4.8% to hit a record high, putting it in a rare group with Nvidia, Microsoft and Apple. It’s up more than 65% this year. (Barron’s)
🦃 Thanksgiving could be cheaper this year. Turkey, stuffing and cranberry prices are all lower, according to the American Farm Bureau Federation. The cost of a traditional Thanksgiving dinner is down about 5% from 2024. (WSJ)
🍻Want more financial news, but after the closing bell? Thousands of readers trust Brew Markets for their end-of-day analysis. I’ll handle your morning dispatch, and you can wrap up your afternoons with Brew Markets from Morning Brew — sign up free.
Rapid-fire
Defense stocks dropped as odds of the Ukraine war ending rise (Barron’s)
Amazon’s data center tally surpassed 900 facilities across 50 countries (Bloomberg)
The math suggests the new poverty line in America should be above $130,000 (Substack)
Commerce Secretary Howard Lutnick says the EU must change its digital regulations for the US to lower its metal tariffs (WSJ)
Novo Nordisk stock dropped more than 5% after poor results from its Alzheimer drug trials (Reuters)
Tesla stock jumped 7% as Melius Research called it a “must own” for its self-driving (Yahoo Finance)
Jerome Powell is dealing with a silent crisis at the Federal Reserve (Pomp Letter)
Wall Street is positioning for Google to win the AI race (Opening Bell Daily)
BlackRock’s IBIT, the largest bitcoin ETF, has posted a net $2.2 billion outflows in November so far (WSJ)
On this day
🗓 November 25, 1963: The New York Stock Exchanged closed for the entire day as the US observed a national day of mourning for President John F. Kennedy, who was laid to rest at Arlington National Cemetery.
Last thing
📩 Want to get in front of 192,000+ investors who get this newsletter and the 350,000 professionals who can access it on Bloomberg Terminals? Reply to this email and tell us why we should work together.
About me
📰 I’m Phil Rosen, co-founder and editor-in-chief of Opening Bell Daily. I’ve published books, lived on three continents, and won awards for my journalism, which has appeared in Business Insider, Fortune, Yahoo Finance, Bloomberg and Inc. Magazine.
I write our flagship newsletter to prepare you for each trading day — unpacking markets, economic data and Wall Street with analysis you won’t find anywhere else.
Feedback? Reply to this email, ping me on X @philrosenn, or write me directly at [email protected].