TL;DR

Fed holds rates; dual dissent likely; U.S. stocks fall; Tesla inks $4.3B U.S. battery deal.

Highlights

• Fed expected to hold rates at 4.5% today; dual governor dissent (Waller, Bowman) likely, raising volatility risk118.
• U.S. equities fell Tuesday, snapping S&P 500 and Nasdaq win streaks as investors await Fed decision and big tech earnings819.
• U.S.-China trade: Beijing welcomes some U.S. curbs lifted, but 145% U.S. tariffs remain; trade talks ongoing2.
• Tesla signs $4.3B battery deal with LG Energy Solution for U.S.-made cells, reducing China supply chain exposure3.
• China signals more fiscal stimulus to counter weak growth; Politburo sets October plenum for further policy4.
• Bitcoin ETF inflows top $50B; Ethereum ETFs see record July inflows, with BlackRock and corporates increasing allocations5.
• Barclays profit up 23% on tariff-driven trading, announces £1B buyback; HSBC and Rio Tinto miss profit estimates, Rio raises dividend1112.
• Eurozone Q2 GDP up 0.1%, beating estimates; France and Spain outperform, Germany and Italy contract7.
• Humana raises 2025 profit outlook above consensus after strong Q2 and contained medical costs9.
• Indonesia to double domestic crypto transaction taxes and hike offshore platform levies from August 115.
• Australia’s Q2 core inflation slows to 2.7%, boosting RBA rate cut expectations; AUD steady ahead of Fed14.
• Oil prices rise on renewed Russia sanctions threats; U.S. 10-year Treasury yields at four-week lows8.

Commentary

Traders face a pivotal Fed day, with the market fully pricing in a rate hold but bracing for a rare dual governor dissent from Waller and Bowman118. This signals a potential shift in the committee’s tone and could increase volatility in rates and FX markets, especially as Powell faces political pressure and moderating inflation1. The statement and press conference will be closely watched for any forward guidance on cuts, particularly given historical patterns where dovish dissents have preceded rate moves1.

U.S. equities pulled back Tuesday, breaking multi-session win streaks as investors digest mixed corporate earnings and await results from tech heavyweights819. The unresolved U.S.-China tariff situation continues to weigh on sentiment, despite Beijing’s positive rhetoric on some curbs being lifted28. Tesla ’s new U.S.-based battery supply deal with LG highlights ongoing efforts by U.S. firms to de-risk supply chains amid persistent tariff headwinds3.

Global macro signals are mixed. China’s commitment to more fiscal support and the Eurozone’s modest GDP beat provide some support for risk assets, but growth remains uneven and policy uncertainty persists47. In commodities, oil prices are higher on threats of new Russia sanctions, while U.S. Treasury yields have fallen as investors seek safety ahead of the Fed8.

Crypto markets remain a bright spot, with institutional demand driving record inflows into Bitcoin and Ethereum ETFs5. Regulatory tightening in Indonesia and Ethereum’s 10th anniversary highlight the sector’s maturation and global reach1520. Meanwhile, Humana ’s raised profit outlook and Barclays ’ strong trading results stand out in an otherwise cautious earnings environment911.

Key risks today: Fed tone and dissent count, U.S.-China trade headlines, tech earnings, and cross-asset volatility as positioning adjusts to central bank signals18.