On July 29, JPMorgan's market intelligence team stated that the Federal Reserve keeping interest rates unchanged while sending dovish signals would be the "best outcome" for the stock market. The team's scenario analysis shows a 28% probability of the Fed holding rates steady and releasing accommodative signals on the inflation outlook. In this case, the S&P 500 could rise 0.5% to 1%. The team led by Andrew Tyler wrote in a report that the worst outcome would be a 50-basis-point rate hike by the Fed, but the probability of this scenario is only 1%. In this case, the S&P 500 could fall 2% to 4%. The team's base-case scenario, with a 50% probability, is that the Fed maintains a hawkish stance and keeps rates unchanged. Under this scenario, the Fed warns that vigilance against inflation is still needed. Swap traders expect a 25-basis-point rate hike at the Fed's decision later on Wednesday to have a 30% probability. JPMorgan's team noted that even if the Fed cuts rates, stocks could fall if the market perceives it as losing independence.