Fed dissent takes center stage as stocks lose traction

The lead for Thursday is the bond market. Wednesday's session ended with the Dow Jones Industrial Average down 280.12 points, or 0.57%, at 48,861.81, while the S&P 500 slipped 0.04% to 7,135.95 and the Nasdaq Composite edged up 0.04% to 24,673.24. Equities were choppy all day, but the more important move came after the Federal Reserve delivered an 8-4 decision to hold rates at 3.5% to 3.75%, the widest dissent since 1992, a reminder that the path to easier policy is getting less certain, not more. CNBC CNBC

That matters because traders have spent weeks treating higher oil as a nuisance and Big Tech as the real story. On Wednesday, rates pushed back. Fed Chair Jerome Powell said elevated energy prices will feed into near-term inflation, and the split vote underscored how uneasy policymakers are about cutting into an inflation backdrop that is still running above target. Investopedia CNBC

Treasury yields jump as traders rethink the Fed path

The Treasury selloff was the cleanest market signal of the day. Bloomberg reported that two-year yields posted their biggest rise on a Fed decision day since 2022, while the move in the front end reflected growing bets that sticky inflation could keep policy tighter for longer and even revive discussion of a 2027 hike. Bloomberg

By late Wednesday, the 10-year Treasury yield was around 4.41%, close to this year's highs, according to Barron's and CNBC. That's the level equity traders need to watch this morning. If the 10-year keeps pressing higher, richly valued growth stocks will have a harder time absorbing even strong earnings. Barron's CNBC

Oil's rally is now a macro problem, not just an energy trade

Crude kept climbing as the Strait of Hormuz disruption dragged on. Brent settled at $118.80 a barrel, up 6.78%, while U.S. benchmark crude traded around the $100 area, according to CNBC and Forbes Advisor pricing. Reuters reported that shipping traffic through Hormuz remained a fraction of normal levels, with the U.S. and Iran still deadlocked over terms to reopen the waterway. CNBC Forbes Advisor Reuters

This is why the inflation story has changed. Higher oil is no longer just lifting energy shares. It's feeding directly into breakeven inflation expectations, Treasury yields, and Fed uncertainty. AP's reporting on the U.S. blockade pressure on Iran adds to the sense that this is not a one-day headline but a broader geopolitical overhang with real consequences for global supply. AP

Big Tech earnings split the tape after the bell

After Wednesday's close, the market got the earnings avalanche it had been waiting for. Alphabet shares jumped about 6.8% in premarket trading to roughly $370.94, and Amazon rose about 2.7% to $270, suggesting investors liked what they heard. Microsoft slipped about 1.2% to $419.21 premarket, while Meta dropped roughly 8.8% to about $610.48, a sharp reversal that points to concern around spending and guidance. Yahoo Finance Yahoo Finance Yahoo Finance Yahoo Finance

Meta's own release showed why the stock reaction was so violent even though the quarter itself was strong. Revenue rose 33% to $56.31 billion, net income climbed 61% to $26.77 billion, and EPS came in at $10.44. But capital expenditures were a hefty $19.84 billion, and investors appear to be focusing on the spending trajectory more than the headline beat. Meta Investor Relations

Microsoft's quarter was also big on the surface. Yahoo Finance's transcript summary showed revenue of $82.9 billion, up 18%, EPS of $4.27, up 21%, and Microsoft Cloud revenue of $54.5 billion, up 29%. Its AI annual recurring revenue topped $37 billion. Yet when rates are rising and AI expectations are already sky-high, good numbers are not always enough. Yahoo Finance

One notable single-stock winner outside megacap tech was Qualcomm. The chipmaker closed up 4.0% at $156 and then surged nearly 11.7% premarket to $174.24 after reporting Q2 revenue of $10.6 billion and non-GAAP EPS of $2.65, with automotive growth standing out. Yahoo Finance Yahoo Finance

Gold firms, crypto stays secondary to macro

Gold has been acting more like an inflation hedge than a panic hedge. Reuters reported that bullion had fallen for a third straight session on Wednesday as traders weighed the inflationary impact of the Middle East conflict against the prospect of higher-for-longer policy. The metal is still drawing support from geopolitical risk, but the stronger immediate market message is that rising yields are capping the upside. Reuters

Crypto is moving, but not enough to drive the broader tape. Bitcoin was hovering in the mid-$75,000s on Wednesday, down about 1.2% over 24 hours, according to Investing News Network, while Reuters snippets indicated Bitcoin was holding around the $77,000 area during the Fed session. That makes crypto more of a sentiment check than a primary market catalyst this morning. Investing News Network Reuters

What to Watch Today

Premarket reaction to megacap earnings: Watch whether Alphabet and Amazon strength can offset sharp pressure in Meta and softer trade in Microsoft. Yahoo Finance Yahoo Finance
Treasury yields: The 10-year near 4.4% is the key line. Another push higher would tighten financial conditions fast. Barron's
Oil and Hormuz headlines: Brent near $119 keeps inflation risk front and center. Any sign of progress or escalation in the U.S.-Iran standoff will matter immediately. CNBC Reuters
Thursday's data and earnings calendar: Traders are lining up for a heavy session that includes fresh economic releases and another packed earnings slate, with Apple among the marquee names due after the close. Yahoo Finance