Mostly Quiet Ahead of Fed Decision

A third-straight quiet day in Iran may be fostering some goodwill toward reconnection for a peace agreement. (Then again, it may not.) Oil prices have definitely cooled since late last week: $81 per barrel (/bbl) on WTI and $87/bbl on Brent, as sentiment gain tacks toward a peaceful resolution. Bond yields have also settled down somewhat: +4.63% on the 10-year T-bill and +4.30% on the 2-year.

The Fed Starts 2-Day Meeting Today

Today is the first day of the fifth Federal Open Market Committee (FOMC) meeting of 2026 so far (of eight total meetings per year), and the last until mid-September. Rates have not moved since December’s quarter-point cut to a range of +3.50-3.75%, and they are not expected to go anywhere today, either. 

Monthly inflation reports have depicted stubborn high costs that are not presently spiraling out of control. This suggests that, while odds now favor a rate hike for the next move at the FOMC, they likely won’t be in any rush to do so. That said, we have seen PCE inflation increase by 30 basis points (bps) or higher month over month since March, reaching +4.1% in June. CPI for June, on the other hand, saw a big drop to +3.5% in its latest report. Most likely, the Fed stays in “wait and see” mode.

Trade Balance, Inventories Come in Slightly Lighter

Headline U.S. Trade Balance for June was slightly deeper than estimates but improved month over month: -$101.5 billion from a revised improvement to -$105 billion in May. That print was still the deepest deficit since the all-time record -$159 billion in March of 2025, which directly preceded “Liberation Day” tariffs, which lasted one week at the start of April.

Advanced Retail Inventories fell back to 0.0% from +0.4% projected, and from the downwardly revised +0.5% for the previous month. This is the lowest since the flat read back in February of this year. Preliminary Wholesale Inventories matched the prior month’s +0.3%, 10 bps lower than expected. More relatively modest prints on the economy, writ-large. More reasons for the Fed to hold its cards today too.

Q2 Roundup: BA, KO & More

Boeing BA posted its third earnings miss in its last four quarters: -$0.76 vs. -$0.34 per share, for a nasty -123.5% negative surprise. Revenues, on the other hand, beat estimates in Q2: $24.56 billion versus $24.05 billion expected, with commercial airplane sales up +14% year over year. Shares are helping boost the Dow this morning, +1.3%.

Coca-Cola KO reported earnings that beat consensus by a solid nickel: +$0.97 per share versus $0.92 estimated. Revenues of $13.37 billion easily surpassed expectations by +2.44%. Shares are up +4% in pre-market trading, also assisting the blue-chip index, and adding to the +20% gains in the shares year to date. For more on KO’s earnings, click here.

UPS UPS made easy work of its Q2 results this morning, posting a +6.67% positive surprise with earnings of $1.76 per share on $22.83 billion in revenues, which beat estimates by nearly +5%. Shares are flagging after a move higher immediately following the Q2 news; shares had been +7.8% over the past month. For more on UPS’ earnings, click here.

Sherwin-Williams SHW posted strong results for its Q2 report ahead of today’s open, with earnings of $3.70 per share nicely above the $3.56 in the Zacks consensus (and $3.38 per share a year ago). Revenues of $6.79 billion outperformed forecasts by +2.58%, and well higher than the $6.31 billion from a year ago. The paints and coatings giant raised guidance above earlier estimates, and shares are trading +7% higher ahead of the bell. For more on SHW’s earnings, click here.

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