To The Moon

The $S&P 500(.SPX)$ Closed lower today for the third day in row after trading near record highs earlier in the session.  The index rallied into the close but gave up its early gains this morning after the Federal Reserve kept interest rates steady, as was largely expected by Wall Street, but in the accompanying Q&A session Fed Chair Jerome Powell signalled that the central bank isn’t quite ready for rate cuts.

S&P 500 1 day chart- Source Tiger Trade

The broad market index closed down 0.1% %, while the $NASDAQ(.IXIC)$ gained 0.15%. The $Dow Jones(.DJI)$ slipped 0.4%.

Tariff impacts on inflation still need to be seen, Powell says

The Fed can keep the interest rate steady while waiting to see if tariff policy pushes up inflation, Powell said.

“Higher tariffs have begun to show through more clearly to prices of some goods, but their overall effects on economic activity and inflation remain to be seen,” Powell said.

Powell said a “reasonable base case” could be that impacts to inflation will be “short lived.” But he also cautioned that levies could also cause inflationary changes that are “more persistent.”

“Our obligation is to keep longer term ... inflation expectations well anchored and to prevent a one-time increase in the price level from becoming an ongoing inflation problem,” Powell said.

“For the time being, we’re well positioned to learn more about the likely course of the economy and the evolving balance of risks before adjusting our policy stance,” he added. “We see our current policy stance as appropriate to guard against inflation risks.”

Modestly restrictive policy still ‘seems appropriate’ here, Powell says

Fed Chair Jerome Powell said during the press meeting that “modestly restrictive policy” still “seems appropriate” here, given the U.S. economy’s enduring strength.

“Today we decided to leave our policy rate where it’s been, which I would characterize as modestly restrictive,” he said. “It seems to me, and to almost the whole committee, that the economy is not performing as though restrictive policy is holding it back inappropriately and modestly restrictive policy seems appropriate.”

Powell says Fed is 'well positioned' to wait for more data before lowering rates

Fed Chairman Jerome Powell reiterated that the central bank remains data dependent when it comes to making monetary decisions in the coming months.

"For the time being, we're well positioned to learn more about the likely course of the economy and the evolving balance of risks before adjusting our policy stance. We see our current policy stance as appropriate to guard against inflation risks," Powell said in the press conference.

Economic growth has moderated but Fed positioned to respond, Powell says

Economic growth has moderated in the first half of this year but the Federal Reserve is well positioned to respond to potential developments, Powell said.

Growth in the first half of 2025 slowed to 1.2% compared to 2.5% last year, Powell said. The moderation in growth mostly reflects a slowdown in consumer spending, he said.

“We believe that the current stance of monetary policy leaves us well positioned to respond in a timely way to potential economic developments,” the Fed chair said.

Bowman, Waller oppose Fed decision

Federal Reserve members Michelle Bowman and Christopher Waller broke ranks on the Fed’s decision to keep the federal funds rate steady on Wednesday, marking the first time in more than three decades that multiple members gave no votes.

Both Bowman and Waller joined the Fed’s board during the first term of President Donald Trump, who has pressured the central bank and its chair, Jerome Powell, to lower borrowing costs.

Tariffs

In today’s episode of the Tariff saga, President Trump announces 25% tariff on imports from India – its 10th largest trading partner.  The president's trade move comes before his 1st August deadline for higher reciprocal tariffs on goods from nearly 180 countries across the world.

US reporting season

This week is the busiest reporting week by US companies with UnitedHealth (down 8%), Starbucks (up on strong China revenue), Merck (down 1%), Boeing (down 2%) and Visa (flat) reporting yesterday;

Ford, Meta, Microsoft and Qualcomm reported today

Amazon, Apple, Mastercard and Illumina report tomorrow, among many others.

Meta Platforms (Facebook)

• Reported $7.14 EPS, up 36% YoY on $47.52 b revenue, surpassing forecasts (~$5.89 EPS; $44.8 b revenue).

• Advertising revenue grew ~21–22% YoY.

• In after-hours trading the stock jump in price by ~9–10% despite heavy AI investments.

• Projecting 2025 operating expenses of $114–118 b due to rising investments in AI and infrastructure.

Microsoft

·       Reported $3.65 adjusted EPS, up 24% YoY on revenue of $97.4B also ahead of forecasts ($3.37 EPS; $73.8B revenue)

·       In after-hours trading the stock jump in price by ~7%.

·       Azure & Intelligent Cloud: Azure revenue surged ~39% year-over-year, exceeding forecasts, while total Microsoft Cloud revenue hit $40.9 b (+21% YoY)

$Ford(F)$ Company — Q2 2025 (April–June)

·       Revenue grew 5% year-over-year to $50.2 billion, beating expectations (~$45.8 b)

·       Delivered an adjusted operating profit of $2.1 b and EPS of $0.37, ahead of consensus of ~$0.33 EPS

·       Net result: reported a $29 million net loss, sharply down from $1.8 b in profit a year earlier, driven by $800 million in tariffs and recall costs (~$1.3 b)

Dow Jones Industrial Average – YTD returns

ENDS

About Greg Boland

Greg Boland is the Chief Strategy Officer for Tiger Brokers. His more than 35 years of specialist experience in capital markets include exchange management, investment advisory management, surveillance and risk and compliance, operations, and governance, and he is an authority in trading systems and methodologies (including online), exchange-traded equities and derivatives, equity options, index futures and options, and financial futures.

About Tiger Brokers in Australia

Tiger Brokers (Nasdaq: TIGR), founded in 2014, is a leading online brokerage firm with a focus on redefining global investing with technology for the next generation. Our unwavering mission of helping everyday Aussies, from beginners to experts, take full control of their investing journey and bringing our local knowledge and industry-leading share-trading platform to every investor.  Currently, Tiger Brokers serves over 10 million users and more than 2 million account holders worldwide on our flagship platform Tiger Trade, with 69 licenses and qualifications in different markets. In 2019, the company was listed on Nasdaq as UP Fintech Holding Limited under the ticker TIGR. For more information about Tiger Brokers, please visit https://www.tigerbrokers.com.au