Stocks Rally Sharply on Dovish Fed Chair Powell

On Friday, U.S. stock indexes closed sharply higher, with the Dow Jones hitting a new all-time high.

• S&P 500 rose +1.52%, Dow Jones gained +1.89%, and Nasdaq 100 climbed +1.54%.

• Futures also advanced, with September E-mini S&P up +1.52% and Nasdaq futures up +1.55%.

Markets rallied after Fed Chair Powell hinted at a possible rate cut next month, citing rising risks to employment. He noted that current policy is restrictive and may need adjustment. Following his comments, the 10-year Treasury yield dropped to 4.24%, and the odds of a September rate cut jumped to 81% from 71%.

Boston Fed President Susan Collins sounded slightly hawkish, saying the economy remains solid but faces both inflation and labor risks.

On geopolitics, the U.S. is pushing peace talks between Russia and Ukraine, aiming for a meeting between Putin and Zelensky, with the possibility of a later trilateral summit including President Trump.

Meanwhile, Trump expanded tariffs on steel and aluminum products to over 400 consumer items, effective Monday, and hinted at upcoming 100% tariffs on semiconductors, with higher tariffs possible unless manufacturing moves to the U.S.