Stocks Rally as Fed Holds Rates Steady:
Stocks climbed through another volatile summer week as mixed Q2 corporate earnings and the Federal Reserve’s rate decision pulled prices in both directions.
The S&P 500 Index rose 1.05 %, while the Nasdaq Composite Index advanced 1.59 %. The Dow Jones Industrial Average added 1.04 %. The MSCI EAFE Index, which tracks developed overseas stock markets, increased 2.13 %.1,2
Source: Bloomberg Finance, L.P. (Performance data normalized 07/24/26 = 0)
Tech Stocks Steal Spotlight
Chip stocks were under pressure at the start of the week as investors fretted over fresh competition from China and higher-than-expected AI capital expenditures. But the Dow pushed higher as oil prices slid and investors rotated out of technology.3,4
On Wednesday, the Federal Reserve said it was holding interest rates steady, a move that was initially well received by markets. But as the day progressed, selling picked up as investors expressed concern that the Fed was not doing enough to battle inflation.5
Markets rebounded on Thursday with semiconductors and big-tech names leading the way. The Nasdaq rose nearly 3 %, ending its 6-day losing streak.6,7
Momentum from Thursday’s rally extended into Friday. Markets rose at open despite diverging Q2 earnings results from two influential tech companies. While it wasn’t a straight line, all three major averages built on gains throughout the day to end the week higher.8
Sources: U.S. Department of the Treasury, Board of Governors of the Federal Reserve System, Charles Schwab
Fed Watch
The Federal Open Market Committee voted 9-3 to hold rates steady: 9 voted to hold, while 3 voted to increase. The decision to hold rates was initially met with enthusiasm, but traders became increasingly unsettled as the day progressed.
At the Fed’s press conference, Chair Kevin Warsh explained the decision, but some were concerned that the Fed was underestimating inflation. The next scheduled two-day Fed meeting ends on September 16, so traders will have plenty of economic reports to assess overall consumer prices.9
This Week: Key Economic Data
Source: Bloomberg Finance L.P.
This Week: Companies Reporting Earnings
Source: EarningsWhispers
Author
Gary Aiken
Chief Investment Officer
Concord Asset Management
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Footnotes and Sources
1WSJ.com, July 31, 2026
2Investing.com, July 31, 2026
3</supCNBC.com, July 27, 2026
4CNBC.com, July 28, 2026
5WSJ.com, July 29, 2026
6CNBC.com, July 30, 2026
7WSJ.com, July 30, 2026
8CNBC.com, July 31, 2026
9WSJ.com, July 29,2026
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