Alphabet Stock News: GOOG jumps on layoffs affecting 6% of search giant's workforce

Alphabet will lay off about 12,000 employees.
GOOG stock has benefited from the news on Friday.
Alphabet will focus on AI technolgy.
$102 is the next price target for GOOG bulls.

Clay Webster FXStreet

Alphabet (GOOG) stock advanced 3.7% to $97.40 on Friday after the paid search and online advertising behemoth announced 12,000 job cuts. Recent data suggests Alphabet, the parent company of Google, had 187,000 global employees, and critics have often suggested that Google has too many employees working on too many non-core segements of the business. The NASDAQ has raced ahead by 0.8% on the open after two sessions of losses.

Alphabet stock news

Alongside Microsoft's (MSFT) recent announcement that it would let go of 10,000 workers and similar layoffs from Meta (META) and Amazon (AMZN), Alphabet and these other named tech giants have downsized by more than 50,000 total workers in recent months. That does not even count fairly large redundancies from the likes of SalesForce (CRM) and Netflix (NFLX).

One important aspect of the recent job cuts in big tech is that nearly all these companies underwent rapid hiring during the pandemic and are now downsizing as management teams expect the Federal Reserve's rapid tightening cycle to be reflected in a jolt to the economy in 2023. News earlier this week that December retail sales dropped -1.1% MoM have since fortified that thinking.

Alphabet CEO Sundar Pichai said in a statement that the layoffs would hit various "product areas, functions, levels and regions" of the conglomerate that houses Google Search, Gmail, YouTube and Android – to name just a few of its most well-known companies. Despite the cuts, Pichai said the streamlined company would emerge with a stronger focus on artificial intelligence.

Alphabet stock forecast

Alphabet stock gapped up on the open above $96 and now will think about retesting resistance at $102. Bulls probably need another catalyst to reach that price level however. GOOG stock last reached this price level on December 1 and last closed above it on October 25. If the excitement over Google's job cuts dissipates, then expect GOOG to drop back to two support zones that surround $85.50 and $83.50. At the moment though, the Moving Average Convergence Divergence (MACD) indicator is just now crossing over in a bullish position above the zero threshold, so expect this rally to have legs since GOOG was already in an uptrend.

GOOG daily chart

Author

Clay Webster

FXStreet

Clay Webster grew up in the US outside Buffalo, New York and Lancaster, Pennsylvania. He began investing after college following the 2008 financial crisis.

GBP/USD remains offered; bears target 1.3600

GBP/USD now leaves behind part of its recent recovery and revisits the low 1.3600s at the beginning of the week. Indeed, Cable trades with a mild downward bias amid decent gains in the Greenback as investors remain wary of upcoming US data releases and the Jackson Hole event.

EUR/USD remains sidelined above 1.1650

EUR/USD trades on the defensive following the closing bell on Wall Street on Monday, hovering around the 1.1660 region and adding to Friday’s small decline. The pair’s pullback comes in response to an acceptable rebound in the US Dollar in a context of generalised caution ahead of key US data releases and Chair Warsh’s speech in Jackson Hole.

Gold advances to over three-month high as bulls look to reclaim $4,700

Gold climbs to a fresh high since mid-May, with bulls now eyeing $4,700 and extending the rally witnessed since the beginning of this month. The US Treasury's bond market intervention failure fuels concerns about fiscal sustainability and boosts demand for bullion as an alternative store of value. Moreover, the US Dollar struggles to attract any meaningful buyers, which, along with receding bets for an immediate Fed rate hike, continues to benefit the non-yielding yellow metal.

Ethereum: BitMine scoops 32K ETH, hints at further gains

Ethereum (ETH) treasury company BitMine Immersion Technologies (BMNR) expanded its digital asset holdings last week with another round of acquisitions. The firm purchased 32,447 ETH during the week, lifting its holdings to 5.847 million ETH. That represents its largest purchase since the first week of July.

Convulsion in credit markets

The United States government just posted a $432.3 billion deficit for July, the largest monthly shortfall since March of 2021. That single burst of red ink pushed the yeartodate deficit to $1.8 trillion, with two months still remaining in fiscal 2026. At this pace, Washington will soon wax nostalgic for the “good old days” when annual deficits were only $2 trillion.

$20 billion offered, $2 billion taken: Why Treasury doubled its buyback cap

The US Treasury moved off its own calendar on Wednesday, and that is the part worth sitting with. At 12:32 GMT, the department said it would at least double the size of liquidity support buyback operations in the 10-year to 20-year and 20-year to 30-year sectors, lifting the maximum from $2 billion per operation to at least $4 billion, effective September 9 and running to November 4.