U.S. stocks are heading into a week shaped by two major tests at once: the Federal Reserve’s rate decision and earnings from large technology companies.
According to BlockBeats, the Fed will announce its policy decision at 2:00 p.m. Eastern Time on July 29, followed by a press conference at 2:30 p.m. The corresponding times in Beijing are 2:00 a.m. and 2:30 a.m. on July 30. The current target range for the federal funds rate is 3.50% to 3.75%.
Base case remains no change
Markets still lean toward the Fed holding rates steady. Even so, the risk of a surprise increase has not been priced out. Current market pricing implies roughly a one-third chance of an unexpected move.
Goldman Sachs economist David Mericle and his team said this week’s Fed decision is “unusually uncertain.” In their view, softer inflation data for June has weakened the case for an immediate rate hike. They also noted that the Fed has rarely delivered a surprise increase without clearer signaling in the past, making it more likely that most voting members will not back action this week.
Still, market pricing shows investors can no longer fully dismiss the possibility of a 25-basis-point hike.
Different calls from Wall Street economists
JPMorgan economist Michael Feroli took a more cautious line. He said policy framework and communication reforms promoted by Fed Chair Warsh are unlikely to reshape the rate path quickly in the near term.
JPMorgan continues to expect the Fed to leave rates unchanged for the rest of 2026, with the next increase possibly not arriving until September 2027. Feroli also said softer CPI data has bought time for the Federal Open Market Committee, while the Fed still retains a tightening bias.
Renaissance Macro chief economist Neil Dutta offered a different warning, telling markets not to ignore the risk of a surprise July hike. He pointed to steady employment, demand boosted by AI investment, elevated oil prices and services inflation, and continued tariff pressure as factors that could lead the Fed to move earlier.
Tech earnings add another layer for equities
For U.S. equities, the rate question is landing at the same time as earnings from Microsoft, Meta, Apple, and Amazon. The combination is set to directly affect risk appetite in high-valuation growth stocks and AI trades.