The Fed holds, Healey's Budget lands softly and the banks report

The Fed sits still

The Federal Reserve left interest rates unchanged on Wednesday. The Guardian noted that it was the central bank's last decision before the midterm elections.

Markets took the news calmly. The Wall Street Journal reported US stocks higher by the close, with Treasury yields mixed. A separate Journal piece described the hold as sending bond yields in different directions, rather than moving them as one. Gold fell overnight as traders weighed the decision. Oil, meanwhile, topped $115 a barrel, a figure the Journal placed alongside the Fed in a single headline. Its broader advice-column framing was that, with the Fed holding steady, investors were left to sit tight too.

CNBC distilled the afternoon into five takeaways from the decision and from Warsh's news conference. The same network carried an interview in which Scott Bessent said it would 'not necessarily' be a mistake if the Fed were to hike again. That is a notable comment to make on the evening of a hold.

Further out, the Journal posed what it called the Fed's AI puzzle: whether high rates will slow the boom in artificial intelligence spending. The question sits awkwardly beside the day's technology results, discussed below.

In Asia this morning, the Singapore dollar strengthened as investors turned their attention to forthcoming US economic data. Sky News, writing late on Wednesday, framed the Fed decision as a prelude to the Bank of England, whose own verdict it described as looming.

A Budget that did little harm

Rachel Reeves is not in this story; Healey is. His Budget, reported by the Guardian as his first, raised taxes on banks and landlords to fund £100 handouts to 20 million households. The headline measures were sizeable. The market reaction was not.

This is Money reported that bank and gambling shares jumped after the tax raid proved 'not as bad as feared'. City A.M. said Healey had avoided a bond market backlash with what it called a 'placeholder Budget'. The backdrop was less comfortable. City A.M. also reported that he faces an '£11bn hole', with growth forecasts slashed and inflation expected to rise higher. HSBC had cut its own UK growth forecasts on the eve of the statement, even as its bumper profits prompted fresh calls for a windfall tax.

Not every measure was welcomed. This is Money said Healey was accused of 'robbing Peter to pay Paul' with a £300m raid on entrepreneurs to fund a new tax break for founders. The High Street, granted a boost on business rates, urged Labour to 'go further, faster' on soaring costs. Savers had their own item: the Guardian reported before the speech that Healey was poised to overturn a cut to the cash Isa allowance.

This morning, City A.M.'s live coverage expected the FTSE 100 to rise as the market digests what it termed a 'do no harm' Budget.

Results, mostly from banks

Big technology offered two contrasting reports. The Guardian said investors turned on Alphabet, the owner of Google, after a profit miss, an advertising slowdown and high spending. Microsoft, by the BBC's account, posted soaring profits only days after announcing thousands of layoffs.

GSK had a difficult day in London. Its shares dived as weaker vaccine sales unnerved investors, according to the Guardian. This is Money added concerns over its pipeline of new drugs, with patent losses looming.

The banks fared better. Standard Chartered closed 7.6 per cent higher in Hong Kong after its third-quarter earnings beat forecasts, with the South China Morning Post crediting its wealth business. Societe Generale posted increases in both profit and revenue for the quarter, the Journal reported this morning. BNP Paribas said stock trading had lifted its profit, and, per Euronews, played down its exposure to French government debt.

Elsewhere in Europe, BASF raised its profit guidance. Euronews attributed the improvement to price increases following the Iran war, a reminder of sorts that the same events lifting oil are lifting chemical margins.

In China, the robotics maker Unitree reported a 70 per cent surge in quarterly revenue, though investment in AI weighed on net profit. JPMorgan Asset Management said it plans more active ETFs in China after its debut fund hit a US$300 million cap on its first day.