Fed Holds Rates Steady; Focus Shifts to Meta and Microsoft's AI Capex
The Federal Reserve held interest rates steady following its July meeting after some uncertainty about whether it would raise them. Three of twelve FOMC members had favored a rate hike, but the decision was ultimately unchanged. The market reacted positively, with major indices recovering from earlier losses and turning positive during Fed Chair Kevin Warsh's press conference. Investor attention is now focused on upcoming earnings reports from Meta Platforms (ticker: META) and Microsoft Corporation (ticker: MSFT), particularly regarding their capital expenditures in AI infrastructure. These announcements could significantly influence semiconductor stocks and the broader market, especially after Alphabet Inc. recently raised its 2026 capex outlook by $15 billion. The next few days will see reports from all four major hyperscalers—Meta, Microsoft, Amazon (ticker: AMZN), and Google parent Alphabet—as well as key data releases like the June PCE Price Index and Q2 GDP estimate. The recent decline in chip stocks suggests that market expectations are shifting toward a near-term peak in AI-related capital spending.
Topics: Federal Reserve interest rates stock market reaction