Dow soars 800 points to record as Powell speech sparks broad market rally: Live updates
Traders work on the floor at the New York Stock Exchange.
Brendan McDermid | Reuters
U.S. stocks jumped on Friday after Federal Reserve Chair Jerome Powell suggested a possibility of interest rate cuts ahead during his much-anticipated speech in Jackson Hole.
The Dow Jones Industrial Average climbed higher by 865 points, or 1.9%, reaching a fresh high. The S&P 500 climbed 1.6%, while the Nasdaq Composite gained nearly 2%.
Shares of megacap technology stocks soared on Powell’s comments. Nvidia added 1.3%, while Meta, Alphabet and Amazon each climbed more than 2%. Tesla shares jumped about 5%.
At the Fed’s annual conclave in Wyoming, Powell said in his tepid speech that while U.S. unemployment remains low, “with policy in restrictive territory, the baseline outlook and the shifting balance of risks may warrant adjusting our policy stance.”
The central bank leader said in prepared remarks that “the balance of risks appear to be shifting” between the Fed’s dual mandate of full employment and stable prices. He cited “sweeping changes” in tax, trade and immigration policies.
Markets were last pricing in a roughly 91% chance of a quarter-point cut at the September meeting, according to the CME FedWatch tool.
The stock market this week has come under pressure amid concerns about elevated valuation and persistent inflation. The prospect of lower interest rates helped bolster parts of the market that have missed out on this year’s rally, with investors dumping tech for small caps and value plays.
Week to date, the S&P 500 and Nasdaq are down 0.9% and 2%, respectively. The Dow has outperformed, rising 0.3% this week.
