The US equity indices ended Wednesday’s session with notable declines as geopolitical risks intensified and oil prices surged following renewed clashes between the United States and Iran. The Dow Jones (US30) slipped 0.01%. The S&P 500 (US500) fell 1.52%. The Tech‑heavy NASDAQ (US100) dropped 1.74%.

An additional negative factor was the Federal Reserve meeting: the Fed left rates unchanged, but the appearance of three dissenting FOMC members favoring a rate hike increased investor caution. The epicenter of the sell‑off was the semiconductor and technology sector, where investors fear excessive capital expenditures on AI infrastructure after disappointing results from SK Hynix. Micron plunged 9.9%, AMD fell by 5.5%, and Nvidia declined by 3.5%.

The Federal Reserve’s decision to keep the policy rate at 3.50%-3.75% in July 2026 aligned with most expectations, despite markets pricing a one‑in‑three chance of a hike before the meeting. The main surprise was the presence of three dissenting votes in favor of a 25‑bp increase – a clear signal of strong hawkish sentiment within the Fed under Chair Kevin Warsh, leaving the door open for tightening at the September meeting.

The Canadian dollar strengthened to around 1.40 per USD, recovering from the two‑week low of 1.42 recorded on July 27. The main driver was the Fed’s decision to keep rates unchanged, which weakened the US dollar. Earlier in July, the Bank of Canada (BoC) left its policy rate at 2.25% for the sixth consecutive meeting, noting the economy’s adjustment to external shocks and easing inflationary pressure from energy prices, though some board members expressed concerns about the durability of the recovery and rising inflation expectations.

Germany’s DAX (DE40) fell 0.01%, France’s CAC 40 (FR40) declined 0.60%, Spain’s IBEX 35 (ES35) dropped 1.59%, while the UK’s FTSE 100 (UK100) rose by 0.34%. Fresh ECB wage‑monitoring data indicate stable and moderate wage dynamics. According to agreements concluded in early July 2026, the projected growth in negotiated wages is 2.3% for this year and 2.7% in Q1 2027 – significantly below 2025 levels. Nevertheless, investors continue to price in the possibility of a second rate hike at the ECB’s September meeting.

Crude oil prices surged more than 7% on Wednesday, rising to around $85 per barrel. The jump ended a three‑day decline and was triggered by a sharp escalation in Middle East tensions. The situation deteriorated after US President Donald Trump stated he was prepared to deliver a powerful strike against Iran in response to an attempted attack on US forces. Physical‑market tensions also increased due to Iran‑aligned groups in Iraq, which for a second day attacked oil facilities in Saudi Arabia’s Eastern Province with drones. Additional concerns emerged after reports that Yemen’s Houthi movement plans to impose fees on vessels in the Red Sea – echoing Iran’s intentions to introduce similar charges in the strategic Strait of Hormuz, posing risks to global energy logistics.

In Asia, Japan’s Nikkei 225 (JP225) fell sharply by 1.49%, China’s FTSE China A50 rose by 0.38%, Hong Kong’s Hang Seng (HK50) gained 1.96%, and Australia’s ASX 200 (AU200) closed 1.01%.

The New Zealand dollar (NZD) strengthened to 0.58 USD amid broad US dollar weakness after the Federal Reserve left rates unchanged for the fifth consecutive meeting. Additional support came from strong domestic data: the ANZ Business Confidence Index jumped to 56.1 in July from 36.6 in June, reflecting improved business expectations.