Wall Street closes down sharply after Fed holds rates unchanged

Wall Street closes down sharply after Fed holds rates unchanged

By Noel Randewich

Wed July 29, 2026  

It was another Wall Street mystery today as right at 3 pm, all three indexes plummeted drastically to major 3-digit losses in tech and a bigger 4-digit loss on the Dow. Up until 3 pm, the indexes had spent the day rather badly in the red but nothing compared to what happened in that final hour. It must have been 3 pm when the Fed announced that it was holding rates steady for now. I guess the fly in the ointment was the dissent of three Fed officials who had voted for a hike. The sizable minority put investors on high alert that the Fed will likely have no choice but to hike in September as the war rages and inflation continues to spike well above the desired target. 

But why today? Everyone expected and, in fact, wanted the rates held steady and in fact were fearful of a hike, so the market got exactly what it wanted. Was it the scare of a September hike that did it?  Is this some sort of preemptive strike hedging against the market tanking in September as nerves continue to rattle over the huge AI capex, fearing they’re digging themselves into a hole they won’t able to dig out of? The good news is that at least Microsoft is now reporting that its AI investments are starting to show returns. The other good news is that new Fed chair Warsh told reporters today that all the AI spending “was laying the groundwork for future growth.” Will other tech companies follow suit? Stay tuned. Two more big days left this week. Volume came in at 17.7 billion, just a tad above the 17.3 average. 

DJ: 52,747.32  +537.24        NAS: 24,876.91  -55.17         S&P: 7,428.78  +15.60           7/28

DJ: 51,594.14 -1153.18        NAS: 24,442.94  -433.97       S&P: 7,316.15  -112.63         7/29

Wed 7-29-26 5:05 pm Wall Street closes down sharply after Fed holds rates unchanged | Reuters