HOTLINE
Hotline Archive
July 29, 2026 Special
This is John Bonnanzio with a Special Fidelity Monitor & Insight Hotline update for Wednesday evening, July 29.
There are no model portfolio trades advised.
As announced last Friday, we did make a risk-reduction trade in our Select and Annuity Sector models on Monday (replacing Consumer Discretionary with Energy in both cases).
The economically sensitive Dow Jones Industrial Average fell 1,153 points today, thereby triggering today’s Hotline message. That said, its 2.2% decline was larger than other more diversified indexes that have less concentration in the industrials sector. For their part, the tech-rich Nasdaq Composite and the S&P 500 were off 1.7% and 1.5%, respectively.
Nevertheless, market volatility has been elevated through much of the year owing in large part to the U.S. war with Iran, oil price fluctuations, and two diverging mindsets regarding AI capex spending and valuations. Atop that, this afternoon investors learned that three voting members of the Fed’s rate- setting committee (there are 12 total) want to raise interest rates above the current range of 3.50% to 3.75%. That’s up from zero votes in mid-June.
While it’s hard to know what exactly is weighing on the collective minds of investors, stocks opened lower this morning as the war took another turn away from negotiations and appears poised to spread with continued demands by the Houthis in the Red Sea area. Today’s oil prices rose nearly 7% here at home – West Texas Intermediate settled at $84.61 a barrel today. Brent crude jumped 8% to over $90 a barrel.
Of course, the specter of a more aggressive Fed in the second half of the year suggests that its members are increasingly concerned about inflation, especially with so much of it being driven this year by elevated energy prices. Today, both equity and fixed-income investors saw their various concerns converge.
On the bond side, the 30-year Treasury bond jumped 11 basis points to 5.20%, while the benchmark 10-year ended the day at 4.64% - a rise of 5 basis points. (Bond prices move inversely to their yields.)
While prices for gasoline and diesel now seem poised to remain higher for longer, the U.S. economy will likely tolerate the situation reasonably well thanks to an ongoing glut of natural gas that is keeping electricity costs, heating costs and industrial production costs from rising much. And while higher interest rates may weigh somewhat on consumer spending, the broad impact on corporate earnings growth is not likely to be major.
Finally, our next regularly scheduled Hotline update is Friday July 31.
Fidelity Monitor & Insight's Hotline is updated on Friday evenings or whenever the Dow moves 1,000 points or more in either direction.