After their best week since July, U.S. stocks opened little changed on Monday, with the benchmark S&P 500 and the narrower Dow Jones Industrial Average (DJINDICES:^DJI) both up 0.22% at 10:15 a.m. EDT. This week is light on economic data, so expect corporate earnings to be investors' primary focus again -- in particular, technology company earnings. In the wake of a marked increase in volatility of the Nasdaq Composite (NASDAQINDEX:^IXIC) (including a correction in biotechnology stocks), this week will give the market a lot of new data against which to measure technology share valuations. Netflix is scheduled to report its first-quarter results after today's market close, followed by Apple (NASDAQ:AAPL) and Facebook on Wednesday. To round things out, and Microsoft (NASDAQ:MSFT) will chime in after Thursday's market close.

If you're not sure why financial journalists and investors will be paying attention to these companies, consider that this group of five high-flying technology names alone weighs in at a combined market value of $1.1 trillion, or roughly 5% of the total U.S. equity market capitalization (yes, the aggregate value of every single publicly traded company U.S. company).

Those numbers alone don't convey all of the companies' influence, of course; indeed, the smallest one by market value -- Netflix, at roughly $21 billion -- is also expected to show the highest year-on-year growth in earnings per share (note the gaping divide in the following table between the growth rates of "new tech" and "old tech"):


Expected EPS growth rate, based on the consensus estimate










[The base EPS figure is negative.]

Source: S&P Capital IQ.

[Strictly speaking, Netflix is not part of the technology sector, but its dynamics are very similar, both in terms of business fundamentals and in how the stock is perceived.]

I'll be particularly interested in "old tech" stalwarts Apple and Microsoft this week. The former is not expected to announce any new products alongside its results; however, at the end of February, CEO Tim Cook promised that the company would update investors on its capital return program "within the next 60 days"; this is the perfect opportunity, with new Chief Financial Officer Luca Maestri making his first appearance. A year ago, Apple raised its share repurchases and dividends to $100 billion by the end of 2015, and that program is now more than half complete (by value). Without a new product announcement, another increase in the capital return program would placate investors.

At Microsoft, meanwhile, new CEO Satya Nadella has been doing a standout job since he took over the reins from Steve Ballmer in February. The market responded by sending the shares to a 14-year high in March. Nevertheless, much work remains to be done to turn this juggernaut around -- this week's results will provide more elements to assess Nadella's performance.