S&P 500, Nasdaq futures inch up before Fed decision

S&P 500, Nasdaq futures inch up ahead of the Federal Reserve's decision. The Dow Jones was also higher, with investors awaiting the Fed's decision and key tech earnings. Investors are cautious, with some skepticism about earnings from Microsoft and Meta.

The S&P 500 and Nasdaq 100 futures inched higher Wednesday, July 29, while Dow futures slipped as investors awaited the Fed's rate decision and a wave of Big Tech earnings after the close. Oil jumped after U.S. forces intercepted a surprise Iranian attack on American troops in the Middle East, reviving inflation worries hours before the Fed speaks.

This meeting is a hold-versus-hike debate, not hold-versus-cut. CME FedWatch priced roughly 62% odds the Fed holds at 3.50% to 3.75%, with the rest leaning toward a 25-basis-point hike as oil-driven inflation risk builds. The meeting has no updated projections, so Chair Kevin Warsh's press tone could move markets more than the vote. The 10-year yield sat near 4.63%.

The bigger catalyst lands after the bell: MSFT and META report second-quarter results. Wall Street models Microsoft earnings of $4.24 a share on $87.63 billion in revenue, and Meta earnings of $7.18 a share on $60.22 billion in revenue. Chip stocks wobbled amid a selloff running through July on AI-spending doubts.

A hawkish hold with cautious AI capex commentary would most likely unsettle futures Thursday. A measured hold plus earnings showing AI spending feeding cloud and ad revenue growth could extend the recent stabilization. Watch Warsh's inflation tone as closely as the earnings prints.

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