The Market News Today: Rate Decision Looms – Investors Seek Clues on Fed’s Next Move

Fed Expected to Hold Rates, Signal Potential September Cut

The Federal Reserve is anticipated to keep interest rates steady at its upcoming meeting but may indicate readiness for a rate cut in September. With improving inflation data, markets are pricing in a high probability of easing. The Fed is expected to subtly adjust its language to reflect this shift without fully committing to a specific timeline. Economists predict the central bank will aim to balance market expectations with the need for flexibility, given recent positive economic indicators and the ongoing need to monitor inflation trends.

Boeing’s Q2 Results Loom: Turbulence Expected Before the Opening Bell

Boeing faces a critical moment as it prepares to report Q2 results amid ongoing challenges. Following safety issues, production slowdowns, and increased scrutiny, the company’s financial performance is expected to suffer. Revenue is projected to drop 3% year-over-year, with a significant hit to profitability. Cash burn remains a concern, with potentially $8 billion in negative free cash flow for the first half of 2024. Commercial deliveries declined 32% in Q2, raising questions about Boeing’s ability to expand production amid regulatory oversight. Investors will be looking for signs of progress as the company attempts to navigate these turbulent times.

After the Close: Meta Reports Q2 Earnings, Ad Growth and AI in Focus

Meta reports Q2 earnings after Wednesday’s closing bell, with analysts anticipating year-over-year revenue and earnings growth. Investors focus on advertising strength and AI developments post-Llama 3.1 launch. Projected revenue is $38.37 billion, up 20% from last year, with $12.32 billion expected net income. Ad revenue is forecast to grow 20.5%. Meta’s AI investments will likely be discussed. The stock traded at $462.94 pre-market Wednesday, up nearly one-third this year. Options traders expect a significant 9.24% move in either direction following the earnings report, highlighting potential volatility.

U.S. Futures Rise as Investors Eye Fed Decision, Earnings, and BOJ Move

U.S. stock futures are sharply higher early Wednesday following the Bank of Japan’s interest rate hike and bond-buying adjustment. Investors are focused on earnings reports and the upcoming Federal Reserve decision. Microsoft shares fell in after-hours trading, while AMD and Nvidia climbed. The Fed is expected to maintain current rates, with markets anticipating signals about future cuts. Economic data and more earnings reports are due. July has been volatile, with the S&P 500 and Nasdaq set to end lower, while the Dow and Russell 2000 are poised for gains, reflecting a market rotation.

Mideast Tensions Lift Oil and Gold; Fed Uncertainty Caps Gains

Israel’s airstrike against Hezbollah sparked a risk premium in crude oil markets, despite no immediate supply disruptions. This geopolitical tension also bolstered gold’s appeal as a safe-haven asset. However, gains in both commodities were limited by uncertainty surrounding the Federal Reserve’s monetary policy. Traders are speculating whether the Fed will cut rates in September and potentially hint at further easing in December, adding complexity to the market outlook for both oil and gold.