The Federal Reserve and Federal Open Market Committee are scheduled to announce July's interest rate decision at 2 p.m. ET Wednesday. Although the expectations are for the Fed to keep rates unchanged, one analyst is projecting that stock prices will surge following the announcement.

CME Group's FedWatch tool, which tracks the probability of Fed decisions on interest rates, shows only a 3% chance the Fed does end up cutting rates by 25 basis points Wednesday afternoon. But Fundstrat's Tom Lee said that he still expects stocks to surge higher following the announcement.

The Call: Lee says that while market participants expect interest rates to come down in September, equity traders will not begin pricing that dynamic until the decision is made final. And if Fed Chair Jerome Powell, who will speak at 2:30 p.m. ET Wednesday, confirms the Fed is planning on cutting rates in September, stocks could get a boost.

“The key premise is the Fed is likely to commit to a September rate cut of at least 25bp. A possibility of more than that is not necessary," Lee said in a note released Wednesday, according to Business Insider.

Why It Matters: Big tech companies like Microsoft, Apple and others have held up well despite higher interest rates. Other sectors like clean energy, tracked by the iShares Global Clean Energy ETF (NASDAQ:ICLN), have struggled in a high-interest rate environment, with the ETF trading down more than 8% year-to-date against the S&P 500 tracking ETF’s gain of more than 16%.