The S&P 500 eked out a small gain on Tuesday, and if you ask the crowd on Polymarket, the benchmark index is likely to keep climbing at Wednesday's open. The prediction market contract for July 29 implies a 70% chance the index opens higher, after it closed Tuesday at 7,428.78, up 0.21% from its open of 7,395.55.
That might sound like a coin flip with a slight edge, but Wednesday is shaping up to be one of the most consequential days of earnings season. The Federal Reserve announces its latest interest rate decision, followed by Chairman Kevin Warsh's press conference. Markets broadly expect the Fed to leave rates unchanged — CME FedWatch data shows that's the overwhelming consensus — but Warsh's tone on inflation and the economy could still rattle things.
Then there's the tech earnings deluge. After the closing bell, we'll hear from Microsoft (MSFT), Meta Platforms (META), and Qualcomm (QCOM). Earlier in the day, Procter & Gamble (PG) reports. Investors will be laser-focused on AI-related capital spending and corporate demand, especially from the hyperscalers — those massive cloud and data center investments that have been a key driver for semiconductor stocks.
The Bull Case
Tuesday's rally was a classic rotation trade. Investors moved out of high-flying tech and into old-economy sectors, helped by stronger-than-expected earnings and falling oil prices. The Dow Jones Industrial Average surged more than 500 points, powered by Sherwin-Williams (SHW) and Coca-Cola (KO), both of which beat earnings estimates. Meanwhile, crude prices eased after diplomatic discussions involving Iran, Saudi Arabia, and Oman, which supported broader market sentiment.
S&P 500 futures were modestly higher early Wednesday, up 0.18%, suggesting the cash market could follow through on the optimism.
How the Previous Bet Played Out
The July 28 Polymarket contract saw about $33,000 in traded volume — relatively quiet compared to earlier in the month. The S&P 500 opened at 7,395.55 on Tuesday, below Monday's close of 7,413.18, so that contract resolved "Down." This time, bettors are leaning the other way.
Whether they're right depends on a Fed that's likely to stay pat, a batch of Big Tech earnings that could either justify or deflate AI enthusiasm, and a market that's increasingly looking beyond the usual suspects for returns. It's a lot to pack into one trading day.
