Wednesday, April 29th, 2026
“Thank you very much, everyone,” Fed Chair Jerome Powell said to the press corps following the latest FOMC decision, to light applause, “I won’t see you next time.” With that, the Fed Chair changes hands to former Fed Governor Kevin Warsh for the next FOMC meeting in June. As expected, no change was made to the 3.50-3.75% Fed funds rate, just as it has been since December of last year.
The economy continues to expand at a “solid rate,” as stated in the FOMC release prior to Powell’s press conference, with unemployment little changed. Stephen Miran, as expected, was the lone policy dissenter — advising yet another 25 basis-point (bps) cut on interest rates. Fed Presidents Hammack, Kashkari and Logan dissented on the opposite side of sentiment: they did not want to keep language regarding a bias toward easing, as has been the case for quite some time.
Powell spoke to this in the presser, citing that “the center is moving toward a more neutral place,” despite Miran’s opinion to the contrary. The Iran war is contributing to a “high level of uncertainty” regarding the economy going forward, with higher global energy prices adding to inflation pressure. This is reminiscent of tariff inflation from a year ago, which Powell today said he expects will subside over the course of this year.
The burning question on the lips of many in the press corps was answered by Powell before the Q&A period began: he would be staying on as Fed Governor instead of retiring, and will not leave the board until investigations and legal actions taken against him by the Trump administration are truly over, “with finality and transparency.” Currently there is some question whether the Inspector General will reopen this investigation.
In his demure manner, Powell went further than at any time previously in describing what is at stake with the Fed’s independence: legal actions are “battering the institution,” Fed independence is what “separates successful countries from unsuccessful ones,” and “if we had acted politically, we would have no credibility.” The outgoing Fed chair said it is not his intention to interfere with the incoming Fed alignment, and that he will remain on until he finds it “appropriate to leave.”
Heavyweights of AI Report Astounding Earnings, Growth
There’s no other way to describe this afternoon’s earnings results than “gargantuan.” The biggest of the big AI players are beginning to show results of their capital expenditures over the past couple years, and the numbers are astounding.
Microsoft MSFT was the tamest of the lot, with fiscal Q3 earnings per share of $4.27 outperforming expectations by two solid dimes, for a +23.4% positive earnings surprise. Revenues of $82.89 billion easily surpassed the $81.40 billion anticipated. But shares are still -2% on the news, as heavy capex is keeping the stock trading down -14% year to date. Its Business Software unit grew +17% year over year and Azure was +40% (still slightly below their “whisper number”), so you can see the results AI is having for the company already.
Alphabet GOOGL shares are up +5.8% on its Q1 report this afternoon, with earnings of $2.81 per share outpacing the $2.64 projected on +22% revenue growth to $109.9 billion (minus Traffic Acquisition Costs [TAC], as Zacks prefers to report it, this figure reaches $96.2 billion, ahead of the $92.2 billion expected). Services were up +16%, including Search +16% and YouTube +11% in the quarter, but it was Cloud that really saw a huge jump: +63% in revenues to $20 billion, with its AI Gemini unit +40% quarter over quarter.
Amazon AMZN blew the doors off earnings expectations in its Q1 report this afternoon: $2.78 per share versus the $1.60 estimate on $181.5 billion in revenues, up from $177.8 billion in the Zacks consensus. AWS demonstrated its fastest growth in 15 quarters, +28% to $37.6 billion, while operating cash flow rose +30% to $148.5 billion. Yet its extraordinary capex spending — upwards of $200 billion — is giving investors some sticker shock, sending shares down -3.8% in after-hours trading.
Meta Platforms META put up the biggest earnings surprise of them all in its Q1 report after the close: $10.44 per share, crushing the $6.71 estimate and +62% year over year on $56.31 billion in revenues surpassing the $55.49 billion expected, +33% year over year. Yet revenues for next quarter are being guided relatively in-line with earlier estimates while, again, extraordinary capex spending is sending shares -6.7% in the after-market, swinging to negative growth in share price year-to-date.
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