FX.co ★ US Stocks Surge After Powell Comments

U.S. stocks experienced a significant rally on Friday, recovering most of the week's earlier losses, following comments from Federal Reserve Chairman Jerome Powell at the Jackson Hole symposium. His speech reinforced expectations of an upcoming interest rate cut. The S&P 500 and the Nasdaq 100 both increased by 1.3%, nearing their record highs from the previous week, while the Dow Jones Industrial Average surged by 700 points. Chairman Powell indicated that the risks of rising inflation have lessened, while employment risks remain a concern, suggesting that these shifts might necessitate an adjustment in policy. Although he cautioned that inflation expectations could become unanchored, his remarks fueled market confidence in an impending rate cut next month, with further cuts anticipated in the fourth quarter. Meanwhile, technology stocks lagged behind the broader market due to growing concerns over the high valuations of companies within the artificial intelligence sector. Notably, Nvidia hovered around the flatline ahead of its earnings report scheduled for next week, which is viewed as a global indicator for AI demand.