The S&P 500 Index (^GSPC 0.71%) managed a solid gain on Monday, up 0.74% at market close. Daily confirmed cases of COVID-19 are still elevated in the United States, but a new stimulus package is in the works. Senate Republicans are soon expected to unveil a bill that includes a smaller enhanced unemployment benefit, money for schools and testing, a targeted second round of Paycheck Protection loans, and a second batch of direct payments to Americans. The total cost is reportedly around $1 trillion.

This stimulus news comes just days before big U.S. technology companies are scheduled to report their quarterly results. The second calendar quarter included widespread retail-store closures and an advertising slowdown, as well as a marked shift to e-commerce. There will likely be some good news and some bad news coming out of these reports. Apple (AAPL 1.82%), Amazon (AMZN 0.51%), Alphabet (GOOG 1.21%) (GOOGL 1.19%), and Facebook (META 2.44%) report this week.

Also in the news was toymaker Hasbro (HAS -0.03%), which reported weak results that led the stock to slump on Monday.

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Big tech prepares to report earnings

Tech stocks had a strong day on Monday, with the tech-heavy Nasdaq Composite outperforming the S&P 500. With a string of high-profile earnings reports coming this week, investors will have a lot to digest.

After the market closes on Thursday, Apple, Amazon, Alphabet, and Facebook will report their results. The numbers will likely be a mixed bag.

Apple will likely report a decline in revenue and profit, hurt by retail store closures during portions of the quarter. The affordable iPhone SE will help boost unit sales, and the services segment will offset some of the weakness. But analysts are expecting a 3.6% revenue decline and 6.9% drop in earnings per share. The error bars around those estimates are wide, so larger declines are possible.

Strong sales growth from Amazon is almost a guarantee, given the growing popularity of e-commerce during the pandemic. However, Amazon warned in its first-quarter report that it would incur billions of dollars in additional costs related to the pandemic. On top of those costs, a slowdown in the cloud computing business is possible as businesses pull back on spending amid unprecedented economic uncertainty. Last week, Microsoft reported a distinct slowdown for its Azure cloud business.

Alphabet and Facebook, both dependent on advertising revenue, could see some pressure as businesses pull back on marketing. Alphabet managed to grow total revenue by 13% in the first quarter, but that period was largely before the disruption caused by the pandemic. The company's second-quarter results will be messier, with analysts expecting a 4.1% revenue decline, on average.

Facebook faces the same advertising spending slowdown, in addition to boycotts from some companies over how it handles hate speech on its platform. Some large brands have stopped or pulled back on Facebook ads, which could have a material impact on its revenue. Facebook has plenty of small advertising customers, but recessions tend to hit small businesses particularly hard. Analysts are expecting Facebook's revenue to grow by just 3% in the second quarter.

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All four tech stocks have risen this year despite the pandemic, with Amazon enjoying the largest gain. A lingering pandemic and prolonged recession, rife with business failures and tepid consumer spending, will hurt all these companies to some degree. So far, investors have largely ignored these risks.

By market close on Monday, Apple stock was up 2.4%; Amazon stock was up 1.5%; Alphabet stock was up 1.2%; and Facebook stock was up 1.2%.

Hasbro misses estimates

One stock unable to rally on Monday was toymaker Hasbro. Sales plummeted 29% on a pro forma basis in the second quarter, hurt by store closures and product shortages. Both franchise brands sales and partner brands sales tumbled by 35%, while the gaming segment saw an 11% sales boost. The company posted an adjusted per-share profit of $0.02, a full $0.21 below analyst expectations.

While Hasbro's second quarter was rough, the company does expect the situation to improve. "While the full-year COVID-19 impact geographically remains unpredictable, as stores reopen and we begin to return to production for entertainment we expect the environment to improve in the third quarter and set us up to execute a good holiday season," said Hasbro CEO Brian Goldner.

Hasbro stock was down 7.3% at market close. Shares have tumbled about 26% this year.