The news is coming in fast and thick. Strap in.

First, interest rates.

The U.S. Federal Reserve lowered rates by 25 basis points, as expected by traders. But Chair Jerome Powell cautioned that another cut in December, which the market had been pricing in with more than 90% certainty, “is not a foregone conclusion.”

His statement threw cold water on the markets, sending most stocks lower and Treasury yields higher.

Next, Big Tech earnings.

Alphabet, Meta and Microsoft reported earnings that beat analyst expectations on the top and bottom lines. Notably, Alphabet’s quarterly revenue topped $100 billion for the first time.

And finally capital expenditure.

Capex is really the big story here. Alphabet, Meta and Microsoft are saying they are going to spend much more money.

Alphabet not only raised its capex estimate for fiscal year 2025 to a “a range of $91 billion to $93 billion” from its earlier forecast of $75 billion to $85 billion, but is now expecting “a significant increase” in capex for 2026, according to finance chief Anat Ashkenazi.

Meta hiked the low end of its capex guidance for the year to $70 billion from $66 billion. “Being able to make a significantly larger investment here is very likely to be a profitable thing” CEO Mark Zuckerberg said in the earnings call.

And Microsoft’s Chief Financial Officer Amy Hood said capex in the firm’s fiscal first quarter came in at $34.9 billion — higher than the $30 billion figure estimated in July. The capex growth rate for fiscal 2026 will also surpass that in 2025, Hood added.

The crux is that spending on artificial intelligence isn’t going to slow down, at least for the next year, thanks to increasing demand for AI services. Fears of a bubble can be deferred for now.

That’s it for the day. We all can take a breather — at least until headlines emerge from U.S. President Donald Trump and China’s Xi Jinping’s meeting later in the day.

Fed cuts rates by 25 basis points. That brings the U.S.’ benchmark interest rate to a range of 3.75%-4%. Two out of 10 governors dissented with the move: Trump-appointee Stephan Miran wanted a half-point cut while Jeffrey Schmid voted for no cuts.

Tech titans report earnings. Alphabet, Meta and Microsoft reported earnings Wednesday after the bell. All beat Wall Street expectations on revenue and earnings per share. AI continues to be a driving force for sales.

Nvidia exceeds $5 trillion valuation. With shares rising 3% on Wednesday, Nvidia’s market capitalization reached $5.03 trillion, making it the first company to break the $5 trillion barrier. The stock has risen more than 50% year to date.

U.S. markets traded mixed Wednesday. The S&P 500 was mostly unchanged, the Dow Jones Industrial Average fell 0.2% and the Nasdaq Composite outperformed to rise 0.55%. The U.S. 10-year Treasury yield climbed above 4%. The Stoxx Europe 600 dipped 0.06%.

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