July 29th Market Overview

Happy Wednesday

Fed sat still today on rates, and the bond market let everyone know it wanted more.

Oil is back up to $85 after Iran tried to hit a US base in Jordan last night. Today was bad but roughly seven in ten S&P names are still above their 200-day average, the best breadth since late 2024.

Let’s dig in...

Today's Big Picture

1. The bond market wanted action, not another promise
   The Fed held at 3.50 to 3.75, and three officials voted to hike. That's the first time three have dissented in the same direction since 2016. Chairman Kevin Warsh said the market has already done the tightening for him, and long yields went up the moment he said it. Jeffrey Gundlach put it plainly on CNBC: if you want inflation back at target, you have to raise rates.
   

2. Oil back near $85 on a real escalation
   Iran fired missiles at a US base in Jordan, ending the brief pause in fighting, and Trump said the US will hit back hard. Crude followed. Energy was the single biggest reason June inflation cooled, which is exactly why this move complicates the Fed's math into September.
   

3. Record profits stopped being good enough
   SK Hynix posted its best quarter ever and still missed, and Korea's market wore it for a second straight day. Seoul called an emergency meeting and is restricting leveraged ETF trading. Here's the part getting lost: the miss came from a heavier mix of high-bandwidth memory, the highest-moat corner of memory and the one Chinese rivals are furthest from entering. Bad print, better business.

Market Overview

Index Performance

Stock Spotlight

Microsoft $MSFT ( ▼ 0.34% )  
beat revenue expectations with $90.01 billion in quarterly sales. Azure revenue reached $39.31 billion, and full-year Azure revenue passed $100 billion for the first time.

Generac $GNRC ( ▼ 0.33% )  
earned $2.91 per share against a $2.01 estimate and signed a second hyperscale customer. It has taken in roughly $1 billion in new orders since its last update.

Ford $F ( ▲ 2.31% )  
raised full-year earnings guidance even though second-quarter revenue fell. Management is telling you the cost side is working.

GE HealthCare $GEHC ( ▲ 12.16% )  
reported a record $23.9 billion backlog and is reviewing options for its Patient Care Solutions unit, the one business that keeps lagging.

Big Name Updates

Procter & Gamble $PG ( ▼ 2.73% )  
missed on revenue and guided next year below expectations. The CFO said they're working harder than they have in a long time to win over shoppers.

Humana $HUM ( ▼ 6.3% )  
cut its full-year outlook and will exit Medicare plans covering about 600,000 members. Margins over membership.

DoorDash $DASH ( ▼ 1.02% )  
won FAA clearance to fly delivery drones beyond visual line of sight. Years of work just turned into a real commercial runway.

Other Notable Company News

Coca-Cola $KO ( ▲ 0.77% )  
raised full-year guidance, and Morgan Stanley and Bank of America both moved price targets to $100.

Teva Pharmaceutical $TEVA ( ▲ 9.19% )  
lifted its sales outlook on stronger branded-drug growth.

Kering $KERX ( 0.0% )  
posted its first revenue growth in eleven quarters as Gucci's decline narrowed.

Deutsche Bank $DB ( ▲ 0.71% )  
reported its best-ever second-quarter pretax profit with all four businesses growing.

United Airlines $UAL ( ▼ 3.57% )  
will help unveil a $22 billion plan to expand Washington Dulles.

Reddit $RDDT ( ▼ 0.26% )  
picked up an Overweight rating and $225 target from KeyBanc, which likes the data licensing angle into 2027.

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Sector Watch

Bond Market

The 30-year Treasury yield hit its highest level since 2007, and the 10-year sits near 4.67. The two-year actually fell.

Policy Watch

Fed

Warsh's argument is that rates are already higher than they were 42 days ago, so the committee can wait. He also made clear he won't hand markets a roadmap, saying surprises aren't the goal but guidance isn't coming back either.

• Beth Hammack, Neel Kashkari and Lorie Logan all voted to hike.

• Warsh: "There is no soft inflation target." Just the one, at two percent.

• June's cool inflation report had "not much" influence on the decision.

• Press conferences stay on the calendar for the rest of the year.

Government

Trump called the Fed board political again and repeated that rates should come down. He likes Warsh and dislikes the committee, which is an odd place for a president to land.

Trade

• Warsh named tariffs as one of three price shocks, alongside the war and AI spending.

• What he's watching is whether those costs bleed into prices far removed from energy and imports.

• Washington may widen China tech restrictions to cover robots and inverters, which chip investors will feel before anyone else does.

What to Watch

The AI company quietly automating every Walmart distribution center. 
23 billion in orders on the book.

It's just one of seven names in this free MarketBeat report.

Thursday's inflation print
The Fed's preferred gauge, plus second-quarter GDP, all before the open. A hot number puts September firmly in play.

Apple and Amazon Thursday
Their spending plans will matter more than their quarters.

- John

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