Stock market faces key tests as AI trade weakens

Next week brings major risks for the stock market as the AI trade falters, with megacap earnings, a Federal Reserve meeting, and a key inflation report all scheduled. Alphabet, Amazon, and Microsoft report earnings after Meta and Tesla drew poor receptions, raising fears of heightened AI capital spending. The Fed is expected to hold rates steady, while the PCE inflation gauge is projected to show rising core prices. The S&P 500 has seen 82% of reporters beat expectations, with earnings growth near 30%, but tech weakness persists as semiconductors have dropped over 15% this month.