Cryptocurrencies Perk Up After Fed Leaves Rates Unchanged — Market Talk

1420 ET - Major cryptocurrencies rise following the Federal Reserve's 9-3 vote to leave interest rates unchanged. Traders were tentative ahead of the decision in anticipation of a potential surprise rate hike supporting a stronger dollar and hitting riskier assets like cryptocurrency. Bitcoin is now up 0.8% to $64,334, while ethereum rises 0.1% to $1,919, XRP is up 2.2% to $1.09, and solana rises 0.1% to $74.10. ([email protected])1417 ET - Treasury yields and the dollar fall on the Fed's decision to keep rates steady. Markets had been mostly pricing a hold, but nearly a third of investors bet on a hike, according to fed futures markets via CME. The decision has three dissents voting for a rate increase, likely boosting odds of a September hike. Energy prices driven by the war in Iran remain a worrisome factor in monetary-policy decisions. The two-year Treasury yield, which is more sensitive to Fed moves, falls to 4.281% from 4.316% ahead of the decision. The 10-year slips to 4.627% from 4.637%. The WSJ Dollar Index is down 0.2% after trading flat earlier. ([email protected]; @ptrevisani)1414 ET - Celestica's strong 2Q results, growth profile and extended order visibility are key drivers of its idiosyncratic outperformance, says RBC. In a report, Paul Treiber says Celestica's shares got a boost due to solid 2Q performance and a 2026-2027 outlook above consensus. "Celestica is executing well, with share gains, an increasing mix of high-quality revenue, and improving visibility to growth," he says, pointing to surging demand for AI compute and networking alongside supply agreements for hard-to-source components like memory.Shares are down 6.9% to C$458.82 but are up 64% over the last 52 weeks. ([email protected])1408 ET - CGI's organic growth should benefit from a stronger pipeline. National Bank of Canada's Doug Taylor notes in a report that organic growth improved sequentially, to a contraction of 1.2% from -3.0% in the previous quarter. This should continue to get better, as U.S. Federal contracts returned to growth with a "strong pipeline across Managed services (+20% Y/Y), SI&C (+30%), IP (+30%) and AI (double Y/Y)," which should help drive bookings and organic growth in the quarters to come, Taylor says. "This reacceleration back into positive territory is a key tenet of our positive near-term thesis," he adds.([email protected])1402 ET - Since the June meeting, Fed officials got a lackluster June jobs report and a cooler set of June inflation numbers. The outbreak of renewed conflict in the Middle East has also pushed up energy prices in July. Despite those evolving dynamics, the Fed's July policy statement is effectively unchanged from the brief memo published after the central bank's June meeting. At the June meeting, the first led by Chairman Kevin Warsh, the Fed trimmed down its statement substantially--and the lack of a meaningful update in July emphasizes the Warsh Fed's reluctance to provide much insight into its deliberations or forward-looking expectations. ([email protected]; @mattgrossman)1350 ET - U.S. commercial crude oil inventories fell by a larger-than-expected 7.2 million barrels last week as refineries ran near full capacity and imports fell, while an additional 3.8 million barrels were released from the Strategic Petroleum Reserve, the EIA reports. "Barrels keep disappearing, with little sign of that trend improving," says David Russell of TradeStation. "The market could enter winter with seriously depleted stockpiles because inventories will need time merely to stabilize before the normal late-fall rebuilding season can begin. Risks increase if the conflict drags on." WTI is up 6.5% at $84.41 a barrel and Brent rises 7.3% to $90.26.([email protected])1312 ET - SoFi Technologies decided to raise revenue forecasts but not earnings guidance for 2H because of the potential for Fed rate hikes in the months ahead, CEO Anthony Noto tells CNBC. The company's stock is getting dinged despite SoFi beating top and bottom line figures in 2Q. Noto says it wouldn't have been prudent to raise the EPS targets without a better view on where rates will go, after having entered the year with expectations that rates would go down. "I just think higher rates create some uncertainty generally," Noto says, adding, "we just wanted to leave some cushion." SoFi also didn't want to undercut its flow of reinvestment in growth opportunities, including its stablecoin, for a guidance boost, Noto says. SoFi falls 8%. ([email protected])1258 ET - The risk of dissents from the Fed is on the rise, not only for this meeting but for ones going forward, a note from Stifel Economics says. Committee members with differing opinions were often satisfied with the inclusion of additional language in the accompanying statement, they say. "Under Warsh, with now a notably reduced statement devoid of further commentary surrounding the Fed's assessment of the economy, and especially forward guidance, Fed members may use dissents as a tool to voice differing opinions from the policy decision." ([email protected])1248 ET - Long-term U.S. government debt looks attractive at current levels, Mackenzie Investments' Dustin Reid tells WSJ. The 30-year Treasury yield is at 5.12% and he caps it at 5.25%. Reid expects bond prices to rise, pushing yields lower, as the Fed leans hawkish and the Treasury increasingly finances itself with short-term debt. Reid likes the 30-year inflation-protected bonds, which he says are "a very good value play for a medium to long-term perspective in our portfolio." The 30-year TIPS yield is at 2.95%, according to LSEG. Beyond Treasurys, "we've also added some 30-year Canadian duration, looking for yields to move lower." ([email protected]; @ptrevisani)1247 ET - Fed Chairman Warsh's tight-lipped approach to forward guidance presents a challenge for investors, says Toronto-based fixed-income strategist Dustin Reid, of Mackenzie Investments. "Position sizing counts even more when you have the expectation of higher volatility around any event, in this case FOMC," he tells WSJ. The lack of guidance means portfolio managers need to spend more time deciding whether to load up on duration, for instance. Currency hedging also becomes more complex for someone who, like him, sits outside of the U.S. ([email protected]; @ptrevisani)1246 ET - The Fed will likely hold today, with potential dissent for a hike and indications that rates will go up in September, Mackenzie Investments' Dustin Reid tells WSJ. "I think the overall communication from the Fed will lean hawkish and lean into a September hike," he says. Reid believes FOMC members will follow Chairman Warsh's call. "I think if Warsh wants a hike, if that's his central tendency that he brought to the committee yesterday, he has the votes." Reid says it is "a close call." A hawkish outcome would likely send short-term Treasury yields higher and long-term ones would outperform, he says. ([email protected]; @ptrevisani)1246 ET - Procter & Gamble's organic sales growth is likely the primary focus among investors following its fiscal fourth-quarter report, Morgan Stanley analysts say. Organic sales were flat in the quarter, solidly below the consensus estimate of 1.6% growth. Organic sales were hurt by retailer inventory cuts, as well as the timing of Easter and Amazon Prime Day, the analysts say. The metric was lower-than-expected in every segment besides Beauty, they say. The miss is likely what is pressuring the stock down 2% following the report, the analysts say. ([email protected])