Microsoft Layoffs, Yum China Earnings, Fed Minutes: Investing Action Plan – Investor's Business Daily

Here’s your Investing Action Plan: what you need to know for the next market day.

The markets are closed for the Fourth of July holiday on Tuesday so here is your action plan for Wednesday.

Microsoft Reorganizing Cloud

XAutoplay: On | OffMicrosoft (MSFT) is reportedly going to lay off thousands of employees as it focuses on integrating its cloud service business. The announcement could come as early as Wednesday.

The move will include a merger of its enterprise customer unit and at least one of its SME-focused divisions, according to sources cited by TechCrunch.

Stocks To Watch

As Microsoft looks to restructure its cloud business, investors should keep an eye on cloud peers Amazon Web Services and Alphabet (GOOGL)-unit Google.

Microsoft, Amazon Web Services and Alphabet are all seeing big cloud-related growth, with Amazon‘s (AMZN) cloud unit the clear leader.

Microsoft, Alphabet and Amazon are among the top stocks in the first half of the year, but all three megacaps were below their 50-day lines at Friday’s close, along with the Nasdaq composite itself.

Facebook (FB) and Netflix — the other two members of the FANG internet group of Facebook, Amazon Netflix and Google — also were below their 50-day lines as of Friday.

Near midday Monday, Microsoft lost 0.6% while the FANG stocks were down about 1% or more on the stock market today. The Nasdaq composite also reversed modestly lower after briefly retaking its 50-day line.

Yum China

Analysts see earnings of 27 cents per share on revenue of $1.6 billion when Yum Brand‘s (YUM) China offshoot reports earnings after the close.

Yum Brands — the parent of Taco Bell, Pizza Hut and KFC — spun off Yum China (YUMC) in November in an effort to improve cash flow.

Yum China shares are hovering above their 10-week moving average and nearing a 42.22 buy point. Yum China rose 1.9% to 40.17 intraday.

Fed Clues

Minutes from the Federal Reserve policy meeting last month, where it raised interest rates for the second time this year, will be released Wednesday afternoon.

Analysts will be looking for clues on financial conditions and when the Fed might raise rates again. Policymakers are expecting another rate hike in this year, and three more next year. Financial markets aren’t convinced of another rate hike this year, but Monday’s strong ISM manufacturing index gave some fodder to Fed policy hawks.

On Friday the Fed’s twice-yearly monetary policy assessment will be released.

RELATED: 

Microsoft Planning To Lay Off Thousands In Reorganization: Report

Amazon Cloud Services Under Growing Threat From Microsoft, Google, IBM

ISM Manufacturing Index Surges To 3-Year High; Fed Back In Play?