FX.co ★ Dow Hits Record as Powell Hints at September Rate Cut

Stocks experienced a notable upswing on Friday following a signal from Federal Reserve Chair Jerome Powell that interest rate reductions might commence as soon as September. The S&P 500 and Nasdaq 100 both advanced by over 1.5%, while the Dow Jones Industrial Average surged by 950 points, marking a 2.1% increase to reach a record high. This upward momentum was driven largely by technology sector giants, with Tesla experiencing a 4.4% rise and Meta, Alphabet, and Amazon each gaining over 1.5%. Nvidia also benefited, with a 1.1% climb. During his speech at the Fed's annual Jackson Hole Symposium, Powell highlighted that the "baseline outlook and shifting balance of risks may warrant adjusting our policy stance." These comments fueled expectations for a 25 basis-point rate cut in the coming month. The probability of such a cut increased to nearly 90% from about 75% earlier in the week. This market rally enabled a recovery from previous downturns linked to pressures on megacap tech stocks, positioning the Dow and S&P 500 for weekly gains and mitigating losses on the Nasdaq.