Markets Mixed as Fed Decision, Tech Earnings Loom

The U.S. equity markets operated with minimal movement on Wednesday because investors processed better-than-expected GDP data while preparing for Federal Reserve policy changes and major tech company earnings announcements. The Dow experienced a slight decline during midday trading while both the S&P 500 and Nasdaq maintained small increases.

The Q2 GDP growth rate reached 3% annually but analysts dismissed this figure because consumer spending declined while imports dropped substantially. TradeStation analyst David Russell stated that the GDP report contains more negative elements than its initial positive appearance suggests. “Underlying demand was weak.”

The market expects Chair Jerome Powell to provide post-meeting insights about potential Federal Reserve rate cuts that could start in September. The September interest rate cut probability stands at 60% according to market futures predictions. The ADP payrolls report exceeded expectations which intensified the discussion about Federal Reserve monetary policy adjustments.

The market waits for Microsoft and Meta earnings reports after the bell while Apple and Amazon will report their results on Thursday. Consumer companies Hershey and VF Corp delivered strong earnings which compensated for initial market declines following President Trump's announcement of Indian trade tariffs and his threat to impose penalties on nations that miss August 1 trade deal deadlines.