Top 10 Things to Watch in Markets on July 23

The 6% decline in Alphabet shares on plans for increased AI spending is pressuring stock futures this morning. Red across the board, and the Dow is going to feel it, too. Alphabet is now one of the 30 stocks in the Dow. U.S. oil prices above $90 per barrel on Iran war escalations, and the recently accompanying rise in bond yields, are also weighing on equities. International Brent crude briefly topped $100 again.

Club name Alphabet posted a good, but not great quarter. Extraordinary numbers from Google Cloud, with revenue growth of 82%. But higher levels of capex sparked concerns. How can they monetize this? Wells Fargo analysts see increased spending as a positive, but acknowledge it could be a near-term pain on margins.

Michael Cembalest, the influential JPMorgan strategist, is sounding the alarm on this earnings season. The suppliers of AI equipment, "free cash flow for semiconductor companies (the caboose)," are doing great even as the consumers, "the front end of the train (hyperscalers)," have not been able to monetize. With cheaper models out there, is there value to owning a lot of these customers?

Tesla missed on quarterly earnings despite reporting better-than-expected revenue. There weren't enough answers given on robotaxis and robots as the company shifts focus away from electric vehicle sales. Shares are down more than 9%. Tesla needs to merge with SpaceX , both of which are run by Elon Musk. Nothing I heard last night contradicted that.

Struggling ServiceNow stock rose 2.5% after the company delivered a better-than-expected quarter. This is Nvidia CEO Jensen Huang's favorite choice for moderating software-as-a-service. Call it the pilot and the air traffic controller. ServiceNow CEO Bill McDermott defended the company on "Mad Money" last night, touting a kill switch to stop rogue AI agents to prevent the kind of thing that happened at OpenAI this week.

IBM shares are down 2.5% this morning after the tech giant followed up last week's earnings warning with a guidance cut last night. The reported revenue and earnings were in line with the preannouncement, which crushed the stock. Has visibility improved from last week? Numbers cut too much?

Morgan Stanley lifted its Apple price target to $364 from $360. Analysts see strong fundamentals but a tough set-up into earnings, with the Club stock near record highs. They said Apple must deliver "zero blemishes across the board" for the stock to keep going up. Still, analysts kept their buy rating. I say own, don't trade this one.

Good quarter from Club name Honeywell Technologies (HON) in its first release since spinning off Honeywell Aerospace (HONA). Top and bottom line beats when considering only HON numbers, and an increase to the full-year earnings guide. Organic order growth of 16%, with especially strong bookings in the Middle East, where HON serves LNG customers. We're excited to see what CEO Vimal Kapur can do with a more focused company. The stock is up 2.5%.

Fellow Club name Dover is down 8% this morning after a mixed quarter. The industrial conglomerate's sales were a touch light, but operating margin and earnings topped estimates. I said yesterday this was a make-or-break quarter. Orders were up, and they increased their full-year organic growth guide. We need to see what they say on the conference call, which starts at 9:30 a.m. ET.

Eli Lilly plans to file for approval for its next-generation obesity drug in 2027. Lilly also announced that injectable retatrutide, triple-acting on the GLP-1, GIP, and glucagon hormones, cleared two late-stage trials with substantial weight loss and improved glycemic control. Lilly told CNBC it needs more time to verify the manufacturing and quality-control data before filing with regulators.