Microsoft will be the first of the major companies in the technology sector to report earnings for the last quarter of 2022, and its profits are expected to fall. At the same time, other data must be taken into account, particularly from General Electric, which suffered by presenting a weak forecast, while Johnson & Johnson’s report was slightly better than expected. Europe’s economy appears to have returned to growth, but it comes at a price – the cost of energy subsidies and interest payments on inflation-linked debt led to a sharp rise in government borrowing in the UK in December. Poland has embarrassed Germany with a request to send tanks for Ukraine, and crude oil prices are drifting in anticipation of the release of the latest U.S. oil inventory data. Here’s what you need to know about the financial market on Tuesday, January 24.

1. MICROSOFT TOPS THE LIST OF COMPANIES REPORTING EARNINGS

Microsoft tops the long list of companies reporting earnings for the last quarter of 2022, on a day that is likely to illustrate how widespread the effects of the U.S. economic downturn are.

The software giant is expected to show a modest decline in earnings despite revenue growth of about 8%, as the strengthening dollar negatively impacted the profitability of its global operations.

The company will be hoping its investment in OpenAI, the maker of viral artificial intelligence tool ChatGPT will support faith in its future growth, after signs of a slowdown in its Azure cloud hosting division, which has been a major star in recent years.

2. EUROZONE ECONOMY RETURNED TO GROWTH IN JANUARY; BORROWING IN THE U.K. SURGED

A key indicator of the eurozone economy posted its first gain in 7 months as a collapse in European natural gas prices supported consumer sentiment and prevented a collapse in industrial production.

The S&P Global composite business activity index for the eurozone rose from 49.3 in December to 50.2 in January – more than expected. While this may not be enough to prevent a recession, it adds evidence that any recession would be short and shallow, allowing the European Central Bank to keep raising interest rates to bring inflation down more quickly.

Elsewhere in Europe, Germany’s consumer confidence index rose for a fourth straight month, albeit less than expected, and Britain tallied the cost of runaway inflation as interest payments on inflation-linked debt sharply increased government borrowing in December.

3. U.S. STOCK MARKET CONSOLIDATES AFTER SOLID GAINS ON MONDAY; GE FORECAST DAMPENED SENTIMENT

US stock market futures consolidated moderately in the pre-market ahead of an impending flurry of earnings reports from across the economy. This came after a day of solid gains driven by hopes of a slower interest rate hike by the U.S. Federal Reserve, which will hold its monetary policy meeting next week.

By 06:30 ET (11:30 GMT), the Dow Jones futures were down 85 points, or 0.2%, after the main money index rose 0.8% on Monday. The S&P 500 and Nasdaq 100 futures followed a similar pattern, down 0.3% and 0.4%, respectively, after the indexes rose 1.2% and 2.0% earlier in the week.

Microsoft will report after the close, while the early session will be dominated by data from Johnson & Johnson, Verizon (NYSE:VZ), Danaher (NYSE:DHR), General Electric , Union Pacific (NYSE:UNP), Raytheon (NYSE:RTX), 3M (NYSE:MMM) and DR Horton (NYSE:DHI).

GE’s data mostly matched expectations, but the stock still fell 2.7% in the premarket amid the weak outlook.

Also in focus will be shares of Amazon (NASDAQ:AMZN) after the company launched a new service to sell discounted drugs, and Alphabet (NASDAQ:GOOGL), which is reportedly facing an antitrust lawsuit in the U.S. over its dominance in online advertising.

4. EUROPE READY TO SEND TANKS TO UKRAINE

Poland has formally requested permission from Germany to send Leopard 2 advanced battle tanks to Ukraine, pressing the “door” that the country’s Foreign Minister Annalena Baerbock opened over the weekend.

After months of Germany blocking any initiatives to send tanks to Kiev, Baerbock said Germany would not prevent other countries from sending their own German-built Leopards if they wanted to.

NATO Secretary General Jens Stoltenberg said he was confident a broader agreement on sending heavy armored vehicles as aid to Ukraine would be reached soon.

5. OIL PRICES DRIFTING AHEAD OF API DATA RELEASE

Crude oil prices drifted down following news reports that the Organization of the Petroleum Exporting Countries is likely to leave production quotas unchanged at its next meeting in early February.

OPEC and its allies are facing clear signs of a recovery in Chinese demand coupled with slowing growth in much of the world, especially the U.S., where oil inventories have risen sharply in recent weeks. The American Petroleum Institute will release the latest weekly data on crude and distillate inventories at 16:30 ET.

By 06:25 ET, WTI futures were up less than 0.1% to $81.66 a barrel and Brent futures were down less than 0.1% to $88.20 a barrel.