Fed holds at 3.75%–4% with two hike dissents; Alphabet slides after hours
Thursday, October 29, 2026 · as of Oct 29, 6:28 AM ET · covers the prior trading session
The Fed held rates in a 10–2 vote with two officials favoring a hike, while stocks still edged higher and the 10-year Treasury yield rose to 5.05%. Alphabet's after-hours miss has Nasdaq futures lower ahead of this morning's GDP and PCE data and the ECB decision.
Key numbers
What mattered yesterday
- The Fed held its policy range at 3.75%–4.00% in a 10–2 vote; Lisa Cook and Beth Hammack dissented in favor of a quarter-point hike, and Chair Kevin Warsh gave no signal on December. CappNotes
- Stocks edged up anyway: S&P 500 +0.28%, Nasdaq +0.27%, Dow +0.19%, Russell 2000 +0.41%, with chips leading after SK Hynix's record quarter. CappNotes
- The curve steepened: the 2-year fell 3 bp while the 10-year rose 6 bp to 5.05%. U.S. Treasury
- September's advance goods trade deficit widened to $134.9B (consensus $130B; prior $132.1B); EIA crude stocks fell 1.89M bbl vs. a flat consensus. Trading Economics
- After the close, Microsoft rose about 2.6% on an Azure beat while Alphabet fell about 10% on its first revenue and EPS miss in nearly four years; ServiceNow and Fortinet also sank. CappNotes
Market snapshot
Why it mattered
Reported: Two hawkish dissents and a 5%+ 10-year came on the same day; Alphabet's after-hours slide is pulling Nasdaq futures lower, and Asian tech followed (Hang Seng and KOSPI down), while Japan rose on Advantest's raised guidance.
Our read (commentary, not investment advice): The Fed is no longer debating cuts; the dissent is about hiking. With oil near $100 and the long end above 5%, this morning's PCE print matters more than usual — a hot number could push December hike odds up and pressure rate-sensitive stocks.
Today's calendar
- 8:30 ET — US Q3 GDP (adv.; cons. 3.2%, prior 2.2%), Sept. PCE/core PCE (core m/m cons. 0.3%; PCE y/y cons. 3.6%), personal income/spending, jobless claims (cons. 199K) TE
- ~9:15 ET — ECB rate decision (hold expected); Bank of Japan decision due Friday Tokyo time (TBD)
- Earnings: Eli Lilly, Mastercard, Caterpillar, Merck before the open; Amazon, Intel, Gilead after the close Digrin
Business lens
- Dairy (USDA weekly, week ending Oct 24): 40-lb blocks $1.4178/lb (+3.1¢ w/w), butter $1.3627 (+0.9¢), nonfat dry milk $2.0538 (+5.8¢), dry whey $0.7374 (+1.2¢); barrels unavailable. USDA AMS Latest FMMO (September, all-market average): Class III $16.04/cwt, Class IV $18.94. USDA AMS
- CME spot (Oct 28): blocks $1.7450 (+0.5¢), barrels $1.7250 (+0.5¢); butter, NDM, whey spot unavailable. Class III futures (TE CFD) $15.23/cwt, −0.07%. IndexBox/USDA, TE Week direction: cheese firmer, butter roughly flat.
- Feed: corn near $4.50/bu (near August lows); soybeans 1,217¢ (−0.6%), wheat 600¢ (+0.1%), live ~6:25am ET; soymeal unavailable. TE
- Fuel: US on-highway diesel $6.352/gal, week of Oct 26 (+7.6¢ w/w). EIA
- Freight: DAT spot van $3.09/mi (−3¢), reefer $3.66 (−2¢), week of Oct 10–16. AJOT/DAT
- Rates: SOFR 3.95%; 10Y 5.05%.
Our read: Butter near $1.36 keeps Class IV leaning on powder; strong NDM is doing the lifting. Spot cheese running well above the weekly survey points to a firmer November Class III if it holds. Cheap corn helps feed margins, but $6+ diesel and 5% long rates keep hauling and borrowing costs high.