4:10pm: Eyes turn to Big Tech
US stocks ended Wednesday’s session on a mixed note as investors digested the Federal Reserve’s decision to leave interest rates unchanged and braced for key earnings from Microsoft and Meta after the bell.
The Dow Jones Industrial Average slipped 172 points, or 0.4%, to close at 44,461, while the S&P 500 dipped 0.1% to 6,363. The Russell 2000, which tracks small-cap stocks, fared worst with a 0.7% loss. Meanwhile, the Nasdaq Composite managed to eke out a 0.2% gain to 21,127, helped by tech strength ahead of after-hours earnings.
The Fed’s July meeting held few surprises, but the context surrounding it is anything but ordinary.
“This Fed meeting was a showdown between Trump and Powell,” said John Crossman, managing principal at Vex Securities. “The economy is performing reasonably well on almost all measures, especially with regards to the dual mandate. However, the Fed is not immune from politics.”
Crossman added that by keeping rates steady, the central bank is signaling its independence in the face of mounting political pressure. “There is tremendous political pressure on the Fed Board, with expectations from some to return rates to zero,” he said.
With inflation still running above the Fed’s 2% target and no major red flags on the unemployment front, Crossman said the case for a rate cut simply wasn’t there. “Neither of the twin mandates justified a cut,” he noted.
He also pushed back on arguments that rising interest costs tied to the US government’s ballooning debt should prompt a policy shift. “That argument should actually be directed at the Treasury. The sloppy habits of the past, where we nudge the Fed to smooth over problems, is part of the problem,” he said.
Now, attention turns to after-hours earnings, with Microsoft and Meta set to report. Wall Street is watching closely to see if massive investments in artificial intelligence are beginning to bear fruit.
Adding to the uncertainty is the fast-approaching Friday deadline set by President Trump, who has threatened blanket tariffs on countries that haven’t reached trade deals with the US. Goods from India, in particular, could face a 25% tariff, as talks between the two sides reportedly stall.
3:45pm: Proactive news headlines
- Blockmate Ventures Inc expanded its Bitcoin treasury division by acquiring an additional Bitcoin, bringing its total holdings to two.
- Nextech3D.AI reported a 55% increase in gross profit to $2.24 million over a 15-month period, with gross margins rising to 64%.
- HIVE Digital Technologies surpassed 14 EH/s in Bitcoin mining hashrate, boosting its projected annual revenue run rate to $315 million.
- Royalty Management Holding Corp identified rare earth elements at its Jamaican site, significantly enhancing the resource potential of its 213 million-ton deposit.
- EnWave Corp sold two more 10kW REV dehydration machines to Dairy Concepts Ireland, marking the fifth and sixth units sold to the company.
- American Resources Corp signed an MOU with ASEDA to explore building a critical mineral refinery in American Samoa to process deep sea nodules.
- NanoViricides said its antiviral NV-387, which has completed a Phase I trial with no adverse events, could help combat rising measles cases globally.
- G Mining Ventures Corp released its 2024 ESG report, outlining operational progress and sustainability efforts across its Brazil and Guyana projects.
- MustGrow Biologics Corp. announced a C$3 million private placement to support increased production of its mustard-based soil bioproducts.
- Santacruz Silver Mining Ltd reported Q2 2025 production of 3.55 million silver equivalent ounces, with stable output across silver and zinc.
3:05pm: Stocks on the move
- Electronic Arts Inc reported preliminary fiscal Q1 2026 net bookings of $1.298 billion, exceeding both its guidance high of $1.275 billion and Wall Street estimates of $1.285 billion.
- Etsy Inc shares rose over 5% after Q2 revenue increased 3.8% year-over-year to $672.7 million, beating expectations despite earnings falling short.
- Blockmate Ventures Inc expanded its Bitcoin treasury by acquiring a second Bitcoin using cash reserves, now held in a secure wallet integrated with its audited reporting system.
- Nextech3D.AI reported audited results for a 15-month period showing a 55% increase in gross profit to $2.24 million and an expansion in gross margin to 64%.
- HIVE Digital Technologies surpassed 14 EH/s in Bitcoin mining hashrate, projecting $315 million in annual revenue with 55% mining margins after electricity costs.
2:50pm: Fed holds steady
The Federal Reserve kept interest rates unchanged at 4.25%-4.50% on Wednesday, as expected, but signs point to a potential rate cut in September.
For the first time since 1993, two Fed Governors, Michelle Bowman and Christopher Waller, dissented, voting for a cut, signaling rising concern over economic softness.
Fed Chair Jerome Powell said no decisions have been made about September, adding that policy remains “modestly restrictive.”
“The Fed has likely just bought itself eight more weeks before a pivot,” said deVere Group CEO Nigel Green.
Major indexes stayed mixed: the Dow fell 0.4% to 44,467, the S&P 500 dipped 0.1% to 6,362, and the Nasdaq rose 0.1% to 21,126.
2:10pm: BoC holds
The Bank of Canada decided to hold its policy rate steady at 2.75%, its third consecutive pause.
The central bank acknowledged ongoing uncertainty around US trade policy but signaled a dovish tilt, stating that if inflationary pressures from trade disruptions remain contained and the economy weakens further, there may be a need for a reduction in the policy interest rate.
Wells Fargo maintained its forecast for 50 basis points of additional rate cuts but pushed back the expected timing, now projecting a 25 bp cut in October and another in early 2026.
“We view current expectations for BoC easing through the rest of 2025 as reasonably fair,” analysts wrote, “but believe market participants could be under-appreciating the potential for lower Canadian policy interest rates in early 2026.”
1:10pm: Cyber deal reshapes market
Palo Alto Networks’ $25 billion acquisition of CyberArk is a “strategic home run deal,” according to Wedbush analyst Dan Ives, who views it as a transformative move that positions the cybersecurity giant at the forefront of the sector.
Ives sees the deal as both “an offensive and defensive move by Nikesh & Co. to accelerate the PANW end-to-end platform strategy,” especially as threats driven by AI grow more pervasive.
With this acquisition, Palo Alto solidifies its “platformization” approach and bolsters its capabilities to deliver all-in-one cybersecurity solutions.
“Cybersecurity is a clear 2nd/3rd derivative play on the AI Revolution,” Ives noted, adding that PANW is now “in the driver’s seat to gain market/mind share in the cybersecurity landscape.”
12:25pm: Big tech earnings on deck
Here’s what to expect from Microsoft and Meta when they report their latest quarterly results after the closing bell.
- Microsoft: Wall Street expects Microsoft to report revenue in the range of $73.7 billion to $74.1 billion, implying growth of 13% to 14%. The Street consensus for earnings per share (EPS) is $3.35, reflecting a 13.5% year-over-year increase. Bank of America analysts are optimistic that the company will deliver solid results and potentially a modest revenue beat as momentum continues to build in its cloud and AI-driven segments. They noted strength in Azure could lead to upside of up to 1% above their revenue estimate of $73.7 billion, implying growth of 13.9%.
- Meta: The Facebook, Instagram and WhatsApp parent company is set to deliver another solid quarterly report driven by strength in its advertising business. The Street expects Meta to report EPS of $5.80 on revenue of $44.7 billion, representing growth of 12% and 14% respectively. Capital spending is expected to stay high, according to Jefferies analysts. “We don't expect Meta to pull back much on its capex initiatives given the importance of AI,” they wrote. Jefferies forecasts capital expenditures of $68.6 billion in 2025 and $74.2 billion in 2026.
11:40am: Strong GDP masks soft core
While the headline GDP figure suggests a robust recovery from Q1’s contraction, economists cautioned that underlying demand remained weak.
“The second quarter GDP report has a great headline, but details were weaker,” said Bill Adams of Comerica Bank, noting sluggish business and consumer spending amid tariff uncertainty.
Despite the strong print, Comerica forecasts slower job growth and a slight rise in unemployment in July.
Most analysts expect the Fed to hold interest rates steady at its meeting, while watching for signs to justify a potential rate cut by September.
Gina Bolvin of Bolvin Wealth Management said the report is “unlikely to shift the Federal Reserve’s stance,” with inflation still elevated and growth uneven.
11:15am: Rally faces test
The stock market’s current rally faces a critical test in the coming days due to a packed schedule of economic data and major earnings reports, according to IG’s Chris Beauchamp.
Despite market nerves, stocks have advanced, supported by strong US ADP and GDP data.
“If markets are nervous waiting for the incoming barrage of data then they aren’t showing much sign of it,” Beauchamp said.
While Fed Chair Powell may offer some dovish hints, he’s unlikely to appear influenced by political pressure. The focus will quickly shift to Microsoft and Meta earnings, and with the equity rally looking fragile, weaker-than-expected results could trigger the anticipated market pullback.
10:35am: Growth rebound seen as temporary
A second-quarter rebound in US economic growth is unlikely to mark a return to sustained momentum, according to top investment strategists and economists, who say consumer spending is weakening and tariff-related risks remain.
"The economy temporarily rebounded in the second quarter as businesses imported less in Q2 than in Q1," said Jeffrey Roach, chief economist at LPL Financial. "This should not be construed as an improvement in underlying momentum."
Roach pointed to rising delinquencies among upper-income consumers as a signal that spending could moderate further. “The Fed will likely be in a good place to cut rates by their September meeting,” he added, noting that policymakers may begin preparing markets for a cut soon.
Eric Teal, chief investment officer at Comerica Wealth Management, said the threat of tariffs likely pulled forward consumption in the second quarter. While fiscal stimulus from the Omnibus Budget Bill for Business Activity may cushion the blow from higher tariffs, he warned the full impact of trade policy has yet to play out.
"We are closely monitoring real rates given the US debt levels and the fact that the full effects of tariff policy have yet to be realized,” Teal said.
Nigel Green, CEO of deVere Group, added a cautionary note: “This isn’t a recession, but it’s also not the kind of growth that justifies complacency. The headline is loud, but the fundamentals are getting quieter.”
9:55am: Cautious start
Markets opened little changed on Wednesday as investors took in a stronger-than-expected rebound in economic growth and braced for a key Federal Reserve interest rate decision later in the day.
The Dow Jones was flat, up just 3 points to 44,636, while the S&P 500 edged up 5 points, or 0.1%, to 6,376. The Nasdaq rose 0.2% to 21,141, and the small-cap Russell 2000 led the way with a 0.4% gain.
The cautious start comes after new data showed US gross domestic product grew at an annualized rate of 3% in the second quarter, topping economists’ expectations of 2.6%. The rebound follows a surprise 0.5% contraction in the first quarter, which the Bureau of Economic Analysis attributed to a surge in imports ahead of President Trump’s tariff measures. The Q2 bounce was driven in part by a pullback in those imports, which subtract from GDP.
Markets are in a wait-and-see mode ahead of the Fed’s policy announcement at 2pm ET. While the central bank is widely expected to keep interest rates unchanged, traders will be watching closely for any shifts in the Fed’s outlook, especially amid internal disagreements over the path forward.
Eyes are also on Big Tech earnings after the bell, with Microsoft and Meta set to report. Both companies are among the first of the so-called "Magnificent 7" to post results, and investors will be eager to see whether their massive bets on artificial intelligence are starting to deliver.
9:00am: Big Tech on deck
Wall Street benchmarks are set for a cautiously positive start on Wednesday, as investors awaited key policy signals from the Federal Reserve and major earnings from Big Tech.
Dow Jones futures point to a slightly positive start, called around 13 points higher, whilst the S&P 500 and Nasdaq are similarly tentatively positive before the opening bell.
The Federal Reserve is expected to hold interest rates steady at the conclusion of its two-day meeting, although internal divisions among policymakers and persistent pressure from President Trump have intensified the spotlight on today’s announcement.
Market focus sharpened following a double dose of economic data that surprised to the upside.
The US economy grew at an annualized rate of 3% in the second quarter, rebounding from a 0.5% contraction in the first quarter. The improvement was mainly driven by a drop in imports and a modest uptick in consumer spending.
Meanwhile, private-sector employers added 104,000 jobs in July, well above the 75,000 forecast and a strong recovery from the 23,000 job cuts recorded in June.
President Trump responded to the GDP data by renewing his calls for lower rates, urging the Fed to act immediately.
Two Fed governors, Christopher Waller and Michelle Bowman, have publicly advocated for a rate cut at today’s meeting, potentially setting the stage for the first dissenting votes in over 30 years.
While the Fed is not expected to shift rates today, chair Jerome Powell’s remarks this afternoon will be closely scrutinised for any indication of a policy pivot in September.
The rebound in economic data has cooled recession fears for now. However, concerns remain around the sustainability of this momentum, particularly with trade tensions and political uncertainty looming over the outlook.