The S&P 500 (^GSPC 0.04%) slipped 0.04% to 7,135.95, the Nasdaq Composite (^IXIC +0.04%) inched up 0.04% to 24,673.24, and the Dow Jones Industrial Average (^DJI 0.57%) fell 0.57% to 48,861.81 as traders stayed cautious ahead of the Fed rate decision and megacap tech earnings after the bell.

Market movers

PayPal gained after announcing a major reorganization and designating Venmo as a standalone business unit. Seagate Technology and Bloom Energy jumped on strong earnings.

But the real action today took place after the bell when Alphabet, Amazon, Meta Platforms, and Microsoft announced quarterly earnings. All beat analyst expectations, but Alphabet and Amazon gained in after-hours trading while Meta and Microsoft fell.

What this means for investors

Markets were relatively flat today as investors awaited megacap earnings and Federal Reserve Chair Jerome Powell’s comments following the two-day meeting. As expected, the Fed left rates unchanged, noting elevated inflation. Less expected was the news that Powell would stay on the Board of Governors once his term ends.

Artificial intelligence (AI) spending and company valuations were already under the spotlight this week after questions arose about OpenAI’s internal target misses. As big tech firms race to dominate the AI market, their joint capex has hit record levels of over $650 billion, and there’s increasing pressure to show results. That’s reflected in reactions to today’s Magnificent Seven earnings: Alphabet soared after impressive Google Cloud revenue reassured investors that its AI investments would pay off. Meta tumbled on concerns that it was overspending.