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Powell teases rates cut, sparking Friday’s rally surprise
The Fed chair’s gentler turn jolted stocks higher—here’s what it means for your money.
THE PORTFOLIO
THIS WEEK’S UPDATE
Hi! Hope your week felt calmer than Wall Street’s. Did you catch Powell’s speech? Markets sure did—like kids straining for the first note of the ice cream truck.
Final bell verdict: Portfolio $65,195.86, slipping –$673.19 (–1.02%), while the S&P 500 climbed +1.52% for the week. American Express carried the flag as our standout gainer, while Etsy dragged on returns with a late-week slump. We mistook “oversold” for “undervalued” and held on a touch too long.
Make sure to take a look at our entire portfolio here.
Winner — American Express (+$60.75 / +3.96%)
American Express topped the Dow Jones on Friday, rising $11.35 (+3.7%) as financials rallied after Powell’s Jackson Hole remarks lifted rate-sensitive stocks. That boost sealed a +3.96% gain for the week in our portfolio. Sometimes it only takes one Fed hint to turn a credit card giant into the market’s favorite swipe.
Loser — Etsy (–$16.10 / –3.54%)
Etsy stumbled midweek despite earlier hype—its shares slid as trading volumes decreased by over 38% and AI-generated listings began crowding the marketplace, muddying Etsy’s handmade brand and likely spooking investors. Turns out, handmade returns don’t scale like AI hype.
STORY OF THE WEEK
POWELL’S CAREFUL WHISPER, WALL STREET’S LOUD CHEER
The Fed’s Jackson Hole speech set the tone this Friday, delivering a delicate dance between a gentle wink and hawkish caution. Powell acknowledged increased downside risks in the labor market while keeping inflation’s anchor intact—opening the door to a September rate cut, though he stopped short of a firm commitment.
Markets responded like caffeine on a Friday afternoon: stocks soared and bonds mellowed. The S&P 500 popped 1.36 %, the Nasdaq nearly 1.67 %, and the Dow Jones increased 1.49 %, while Treasury yields headed south fast. It was the kind of verbal nudge traders live for—even if Powell didn’t hand them a map.
So what next? Investors are recalibrating their “Fed-cut meter,” eyeing August jobs and inflation data for clarity. The irony: markets are acting as if the Fed already called it a day—but Powell left more wiggle room than Wall Street likes to admit. Next week’s data releases will be treated like holy script.
QUICK HITS
NOTES FROM OUR DESK THIS WEEK
Jobless Claims: Weekly U.S. jobless claims surged 11,000 to 235,000, the highest since June, signaling cracks in the labor market. Nothing says “Fed watches jobs” like sticky jackets on unemployment rolls.
Powell Rate-cut Odds: After Powell’s gentler tone, markets priced in nearly an 89% chance of a September cut, up from roughly 70% earlier in the day. Chasing cuts like everyone’s late on streaming the finale.
Dow Jones Surge: The Dow Jones jumped 667 points (1.5%) to a record, with all 11 S&P sectors up and chip stocks gaining 3.7%. When the Dow Jones pops, chips don’t sit out the party.
Dollar & Yields: The U.S. dollar index tumbled 0.89% to 97.73, while 2-year Treasury yields slid about 8 bps to 3.69%, lifting rate-sensitive assets across the board. When yields wobble, portfolios get butterflies.
Tech Stability: After earlier pullbacks, tech stocks held steady midweek—Nasdaq and S&P 500 dips slowed, signaling calmer nerves as Jackson Hole loomed.
Political Heat: Amid Powell’s speech, tensions flared as President Trump pressed for Fed Governor Lisa Cook’s resignation—adding drama to more lenient markets. When Fed policy meets political popcorn.
Chinese Tech Lift: China’s tech-heavy CSI 300 index climbed 0.5% toward its highest levels in a decade, carried by enthusiasm for domestic chips and digital assets. China’s tech is leveling up—no cheat codes needed.