Summary
- Market roundup for Friday reflects a risk-on mood as Powell’s Jackson Hole Speech defends his data-dependency but still signals lower rates.
- Bitcoin and Gold reverse early-day losses and face daily gains, while U.S. Dollar slumps.
- Pro-crypto headlines and a broader risk-on mood favor BTC and altcoins.
- With Powell’s speech behind, market focus shifts back to geopolitical tensions around the Russia-Ukraine conflict.
Market Roundup for Friday: Powell’s Jackson Hole Speech Fuels Optimism
Markets’ sentiment finally witnessed an upbeat day on Friday as Fed Chair Jerome Powell managed to push back against the abrupt rate cut pressure, highlighting the data-dependent stance. Even so, the policymaker appears mostly favoring the easy monetary practices, offering a sigh of relief to the traders after a tense week that initially saw heavy rate cuts before upbeat activity data teased policy hawks.
In his initial remarks, Powell unveiled a new policy framework comprising flexible inflation targeting that eliminates the ‘makeup’ strategy for inflation. This was widely expected but offered room for doves as Powell said, “Framework calls for a balanced approach when the central bank’s goals are in tension.” The policymaker cited downside risks to the labor market, as well as the inflation risk due to the tariffs.
Following his remarks, the interest rate futures marked a 90% chance of a September Fed rate cut and two additional rate reductions by the end of 2025.
His comments immediately fuelled the risk-on mood, allowing the risk assets like equities, commodities, and cryptocurrencies to reverse previous losses. The U.S. Dollar Index (DXY), however, faces the biggest daily fall since August 01, down 0.70% intraday to 97.90, allowing Bitcoin (BTC) to jump more than 3.0% to $116K and fuel the Gold price back to $3,365, up 0.90% intraday by the press time.
Talking about geopolitics, U.S. President Donald Trump stated on Truth Social that Ukraine should have invaded Russia to avoid a full-scale war, fueling concerns about a lack of progress in upcoming talks between Ukrainian President Volodymyr Zelenskyy and Russian President Vladimir Putin. Additionally, growing uncertainty about the U.S. security responsibility in the Ukraine conflict weighed on sentiment, as the White House pushes the European Union (EU) to take a major role.
Meanwhile, multiple news outlets conveyed a list of demands from Putin and heightened market fears ahead of the key talks. Important among them were no Donbas return, preventing Ukraine’s NATO membership, and no Western troops on Ukrainian soil.
Further, China is seeking close ties with Pakistan, Kazakhstan, and Afghanistan, raising tensions in the region.
Talking about tariffs, White House trade advisor Peter Navarro suggested that U.S. tariffs on India could double starting August 27. The European Union-U.S. trade deal, which confirmed 15% tariffs, was unveiled but failed to gain much attention.
Crypto, Equity Update
In the crypto market, major coins edge lower as the U.S. Dollar Index (DXY) seesaws at a week’s high.
Talking about the industry news, the European Central Bank (ECB) is considering Ethereum and Solana platforms for a future digital Euro rollout, joining the league of major central banks preparing for the crypto race.
Further, the U.S. Department of Justice (DOJ) offered a sigh of relief to the developer community in the crypto universe, but it still targets the bad actors. That said, Acting Assistant Attorney General of the Criminal Division, Matthew R. Galeotti, spoke at the American Innovation Project Summit in Jackson, Wyoming, while unveiling some good news for the tech-wizards. “Our view is that merely writing code, without ill intent, is not a crime. Innovating new ways for the economy to store and transmit value and create wealth, without ill intent, is not a crime,” said the official.
Read Details: U.S. DOJ Eases Concerns for Developers, Pledges to Target Bad Actors in Crypto
Elsewhere, Aave unveils integration of Chainlink’s Price Feeds on Aptos, opening doors for Decentralized Financing (DeFi) opportunities outside the current Ethereum-based chains.
Meanwhile, Verb Technology Company, Inc. (VERB) is up for changing its name to TON Strategy Co. (TSC) after disclosing a treasury of $713 million worth of Toncoin (TON), the native token of Telegram’s Open Network. This allows the firm to hold nearly 5% of TON’s circulating supplies and help secure Telegram’s blockchain network.
Also read: Verb Tech Allocates $713M to TON Strategy: Becomes Largest Public Toncoin Treasury
In the equity markets, Walmart’s second-quarter (Q2) earnings release weighed on its stock (WMT) on Thursday. Earlier this week, Home Depot also missed EPS expectations. Meanwhile, Target met EPS and revenue estimates but still failed to hold stock gains. This suggests the overall downbeat performance of the key U.S. retailers and flagged the economic uncertainty surrounding the Trump administration’s tariffs, allowing Fed Chair Powell to defend the data dependency approach.
With this, the major U.S. equity benchmarks are all up for the first time this week, with Dow Jones rising over 1.58%, approaching the record top, whereas S&P snapped a five-day losing streak with 1.25% intraday gains. Further, Nasdaq is also up for the first time in four days, rising 1.47% on the day by press time.
- Gold flips to the positive side, up 0.90% intraday to $3,365 at the latest.
- Bitcoin (BTC) rises over 2.0% to reclaim $115K, after being in the red for most of the day before Powell’s speech.
- Ethereum (ETH) jumps over 8.0%, around $4,580, to refresh its weekly high.
- U.S. Dollar Index (DXY) slumps, posting the biggest daily loss since August 01, down 0.70% intraday to 97.90 as we write.
- Wall Street benchmarks rally: U.S. equities reverse the weekly moves, with Dow Jones, S&P 500, and Nasdaq gaining more than 1.0% intraday at the latest.
- WTI Crude Oil prints three-day winning streak, up 0.50% intraday to refresh weekly high near $63.90 by press time.
Back to trade, political news…
Having witnessed an initial reaction to Powell’s Jackson Hole speech, market players may now shift their attention back to the trade and political updates for clear directions, with no major data/events remaining to watch during the day. With this, the details from the Zelenskyy-Putin meeting, US tariff announcements, and Fed independence from political pressure will be eyed, as any negative outcomes could further weigh on market sentiment. If tensions rise, the U.S. Dollar might pare some of its latest losses, which in turn can pressure Gold, cryptocurrencies, equities, and other risk assets.
Also read: Market Digest: Bitcoin Dips to 112K as Powell Speech Looms and Labor Weakness Weighs on Markets
