Retail sales jump 1.2%. Now comes the Fed.

The first test is in: August retail sales rose 1.2% from July, beating the 0.8% forecast. The Fed's rate decision and new projections arrive at 2:00 PM ET, followed by Chair Kevin Warsh at 2:30.

Tuesday's S&P 500 fell 0.45%, the Nasdaq lost 0.78%, and energy was the standout winner. The 10-year Treasury yield touched 5.04% overnight before finishing Tuesday around 5%. Higher oil and higher borrowing costs are pulling in the same direction.

This was not just a gasoline story: sales excluding both autos and gasoline climbed 1.2%. Online sales rose 2.6%. These are spending dollars, not inflation-adjusted volumes, but the result gives the Fed a firmer demand backdrop just hours before its decision.

Markets widely expect a quarter-point increase today. But the decision is only one line of the story. The Fed will also publish its latest rate, growth and inflation projections. Traders are already considering additional hikes in December and March, so the projected path can move stocks even if today's rate change matches expectations.

Yesterday's Empire State survey captured the problem: New York factory activity slowed from 20.6 to 7.6, while the prices-paid index rose to 63.1. Slower activity and faster input-cost growth leave the Fed with less room for a simple victory lap.

The consumer just handed the Fed a stronger demand reading. August sales climbed 1.2% against a 0.8% forecast; July was revised to a 0.5% decline. Excluding autos and gasoline, August sales still rose 1.2%. That breadth complicates a quick pivot toward easier policy. Watch what the Fed says about the path after today, then watch the 10-year yield.

The quarter-point hike is the favored outcome. Watch the Fed's new rate projections for clues about December and next spring. More hikes than traders expect would likely push yields higher; a shallower path could relieve pressure on growth stocks.

Retail sales has now beaten forecasts. Stronger demand may affect the Fed's projected path, so check live rate pricing rather than relying on a fixed morning probability.

Trip.com reported second-quarter revenue of RMB15.7 billion, or about $2.3 billion, up 6% from a year earlier. Revenue on its international platform grew more than 50%. Those are the operating positives.

The headline earnings number tells a different story. Trip.com recorded a RMB5.2 billion antitrust penalty and posted a RMB2.4 billion net loss. Excluding the penalty, the company said net income would have been RMB2.7 billion. Adjusted EBITDA fell to RMB4.6 billion from RMB4.9 billion a year earlier.

The investor question is whether international growth can offset slower core expansion and the cost of operating under closer regulatory scrutiny. The fine is a major one-time charge, but the rules imposed after it may have a longer life.

Saudi Arabia's East-West pipeline remains mostly offline after last week's attack. Two regional officials told AP that repairs could take three to five weeks. The pipeline normally moves crude from the Gulf to the Red Sea, offering an alternative when the Strait of Hormuz is disrupted.

That alternative is now impaired while Red Sea shipping faces its own threats. Oil eased early Wednesday after Tuesday's rise, but the repair timetable keeps the supply risk alive. It also explains why energy stocks rose Tuesday even as most sectors fell.

For investors, watch whether crude stays elevated after the Fed decision. A rate hike can cool demand over time; it cannot replace barrels delayed by damaged infrastructure and shipping risk.

LLY: Berenberg upgraded Eli Lilly from Hold to Buy with a $1,400 target. A bullish broker call does not settle the valuation debate, but it shows conviction is still present in large-cap health care.

RMD: RBC Capital Markets upgraded ResMed from Sector Perform to Outperform and set a $262 target.

WAY: Barclays downgraded Waystar from Overweight to Equal Weight with a $30 target. The call came as reports of a possible sale put the stock in focus. A reported exploration is not an announced deal.