After weeks of market jitters, Federal Reserve Chair Jerome Powell gave Wall Street what it wanted—a clear rate-cut signal at Jackson Hole (CNN, Bloomberg). The result? The Dow soared 846 points to a record high, the S&P 500 snapped a five-day losing streak, and traders began pricing in an 83% chance of a September cut.
- Mortgage rates dropped to 6.55%, delivering rare relief to a battered housing market (WSJ).
- Market euphoria was fueled by Powell’s “dovish” tone and his acknowledgment of a slowing labor market.
But is this optimism justified? Persistent inflation, trade tensions, and ongoing AI sector volatility cast a long shadow over the rally. The real test: will underlying growth and earnings deliver, or was this just a respite before a bumpier fall?
