Stocks closed lower yesterday across the board.

Most of the indexes trimmed intraday losses after the Fed left interest rates unchanged, and Fed Chair Kevin Warsh gave his Press Conference.

But afterwards, stocks turned back around, and sold off into the close, ending at their worst levels by day's end.

Yesterday's FOMC Announcement, as expected, saw the Fed keep rates steady. Although, there were three dissents. It was their 5th meeting of no change in rates since the Fed last cut in December.

Mr. Warsh said the, "The economy output is solid. Capital expenditure and productivity are strong. Labor markets are solid and steady." And "The Treasury market seems to be saying that as well."

While inflation remains above their 2% target, recent better-than-expected inflation readings reduced the need to hike. And with the economy doing well, it removed the need to lower.

And after a "rigorous review" of the economic situation, the Fed decided to leave rates where they were.

But it likely wasn't the Fed that weighed on stocks, but rather the rise in oil prices, with crude rising about 7% yesterday.

Tensions in the Middle East continue to escalate. On Tuesday evening, it was reported that Iran tried to launch a surprise attack on U.S. forces based in the region. Centcom said all missiles were intercepted. Then yesterday, an Iranian drone attack was reported on a U.S. owned LNG tanker.

The U.S. has said they will hit Iran hard.

Even though indirect talks are continuing, you would not know it by the resumption of fighting.

In other news, earnings season continues. After the close, Microsoft posted a positive EPS surprise of 12.59%, and a positive sales surprise of 2.93%. That translated to a quarterly EPS growth rate of 29.9% vs. this time last year, and a sales growth of 17.8%. They raised their constant-currency Azure growth guidance to 39%-40% vs. expectations for 37%. And their contracted backlog increased to $678 billion, up from $627B. They were off -0.71% yesterday in the regular session before earnings. And were trading more than 3% higher in after-hours following earnings.

We also heard from Meta after the close, and they posted a negative EPS surprise of -12.96%, and a positive sales surprise of 0.98%. That equated to a quarterly EPS growth rate of -13.4%, and a sales growth of 27.9%. They raised their full-year CapEx to $130-$145 billion from their prior range of $125-$145B for a 1.85% expected increase. They were off -1.31% in the regular session, and fell another -9% in after-hours.

Today we'll get another 373 companies on deck to report, including two more Magnificent 7 stocks Apple and Amazon after the close.

Apple, once again yesterday, topped $5 trillion in market value intraday, but could not hold onto that mark at the close.

If all goes well today and/or tomorrow, Apple will climb back above that $5T mark and keep on going.

On the economic report front today, we'll get Weekly Jobless Claims, and the advance estimate for Q2'26 GDP.

And we'll get the Personal Consumption Expenditures (PCE) index. The consensus is calling for the headline rate to come in at -0.1% m/m vs. last month's 0.4%, with the annual rate at 3.7% vs. last month's 4.1%. The core rate (ex-food & energy) is forecast at 0.2% m/m vs. last month's 0.3%, with the y/y rate at 3.3% vs. last month's 3.4%.

And we'll see if the market can stabilize after recent volatility.

See you tomorrow,