Summary
- Market roundup for Wednesday portrays a modest optimism as softer U.S. PPI fuels dovish Fed bets and drowns the Dollar despite trade/geopolitical woes.
- US PPI for August hits a four-month low, Core PPI also eases, flagging fears of a 0.50% Fed rate cut in September.
- Russia’s drone attack in Poland, Israel’s Doha blasts and Trump’s legal showdown kept traders on the edge.
- Cryptocurrencies cheer a technical breakout, with more institutional interest to regain upside momentum.
- Wall Street edges higher following a record close by the benchmark indices.
- Adobe earnings, risk news eyed ahead of Thursday’s key U.S. CPI.
Market Roundup for Wednesday: Dovish Fed Bets Favor Sentiment Despite Trade/Political Jitters
The risk complex remains slightly upbeat early Wednesday in New York as downbeat U.S. inflation data bolsters the rate cut expectations from the U.S. Federal Reserve (Fed). In doing so, the traders mostly ignore downbeat trade and geopolitical news.
Amid these plays, Bitcoin (BTC) jumps to a two-week high near $114K, while the spot Gold (XAU) also reverses the previous day’s retreat from its record top above $3,650. That said, the U.S. Dollar Index (DXY) retreats, whereas the U.S. equities edge higher after posting a record close the previous day.
The U.S. Producer Price Index (PPI) for August reports a four-month low of -0.1% Month-over-Month (MOM) versus 0.3% expected and 0.7% prior. The yearly figures also eased to 2.6% Year-over-Year (YoY) compared to the market forecasts of 3.3% and a downwardly revised 3.1% prior.
Additionally, the PPI ex Food & Energy, also known as the Core PPI, also flashed downbeat figures of -0.1% MoM and 2.8% YoY, missing estimates of 0.3% and 3.5% in that order, and down from 0.7% and 3.4% (revised) respective previous readings.
With this, the odds of witnessing 0.25% rate cuts from the U.S. Federal Reserve (Fed) during each of the three remaining monetary policy meetings of 2025 jumped, with a 10% chance of witnessing a 0.50% rate cut during the September 17 announcements. The dovish Fed bets weighed on the U.S. Dollar and allowed U.S. President Donald Trump to take a jab at the Fed Chairman Jerome Powell.
Following the data, Trump harshly criticized Powell (again) while saying, “No Inflation!!! “Too Late” must lower the RATE, BIG, right now. Powell is a total disaster, who doesn’t have a clue!!!”
Elsewhere, Russia escalated against Poland and the North Atlantic Treaty Organization (NATO), with Poland confirming a military operation against a Russian incursion, deploying weapons. A U.S. member of Congress called it an act of war, but markets paid a little heed. This was after Israel attacked a senior Hamas official in Doha via multiple blasts, but failed and received strong international criticism.
On a legal front, a federal judge blocked Trump from firing Federal Reserve Board Governor Lisa Cook, meaning she will vote at the September Federal Open Market Committee (FOMC) meeting.
Alternatively, the U.S. Supreme Court agreed to fast-track its review of Trump’s tariffs, with arguments scheduled for November, making these tariffs valid until then.
On trade, Trump said negotiations with India are ongoing, while urging the European Union (EU) to impose tariffs of up to 100% on Chinese and Indian goods, per Reuters.
Earlier in the day, China’s August inflation showed the Consumer Price Index (CPI) reporting the sharpest fall in six months, while the PPI posting the smallest drop in four months.
Crypto, Equity Update
Crypto buyers cheered the U.S. Dollar’s inability to defend Tuesday’s rebound, amid downbeat U.S. PPI, while hitting a weekly high, with coins like Avalanche’s AVAX and Pyth Network’s PYTH gaining major attention while posting stellar rallies.
Also Read: Avalanche Price Analysis: AVAX Jumps 7% Today; Is $35.0 Next?
That said, some of the top crypto news are as follow, while more updates like this could be traced to our Coin Bytes.
Sky, formerly MakerDAO, joined the league of Agora, Paxos, and Frax Finance while submitting a proposal to become the first official issuer of Hyperliquid’s new USDH stablecoin. The proposal includes a 4.85% yield for holders and a $25 million fund to bolster Hyperliquid’s decentralized finance (DeFi). A validator vote on September 14 will decide who will own the new USDH stablecoin.
Read More: Hyperliquid’s USDH Stablecoin Issuance: DeFi Giant Sky Proposes 4.85% Yield
Elsewhere, a Nasdaq listed penny stock, CaliberCos Inc. (CWD) jumped 2500% earlier in the week, to $56.00, before retreating to $9.13, as market’s reacted to the firm’s undisclosed purchase of Chainlink’s LINK token for its Digital Asset Treasury (DAT) Strategy.
On the same line, a Hong Kong-based media firm, QMMM Holdings, listed on Nasdaq as QMMM, also witnessed a 2300% jump in share prices on Tuesday, before ending the day around $207 with 1,737% gains. The stellar gains could be linked to the firm’s announcement of a $100 million digital asset treasury (DAT) targeting Bitcoin, Ethereum, and Solana reserves.
Also Read: What’s Behind QMMM Stock’s 2,300% Gain? Read Full Story!
Meanwhile, crypto thefts continue to spread, making traders cautious and in need of strong securities. Hackers injected sophisticated malware into 18 popular Node Package Manager (NPM) packages, namely ‘chalk’ and ‘debug’, to steal crypto from wallets. The NPM packages hack impacted tools that had over two billion downloads a week combined.
Check Details: Crypto-Stealing Malware Found in 18 Popular NPM Packages
On Wall Street, equity traders begin Wednesday on a positive note, backed by softer U.S. PPI and reacting to the previous day’s after-market news, while paying a little heed to the growing geopolitical and trade tensions.
That said, Dow Jones remains mildly offered around 45,600, but S&P 500 and Nasdaq both refresh record tops with nearly 0.40% intraday gains each by press time.
On Tuesday, Oracle’s earnings and revenue missed forecasts, but shares soared nearly 26%, its record jump, during after-hours as investors focused on strong cloud growth projections and major new contracts. The company expects to sign more multi-billion-dollar customers, with Remaining Performance Obligations (RPO) likely exceeding $500 billion. That said, stocks of UnitedHealth also rallied.
With this, the S&P 500, Nasdaq, and Dow Jones Industrial Average each closed at record highs, supported by artificial intelligence enthusiasm, Fed rate-cut hopes, and the payrolls’ revision.
- Gold jumps back, reversing the previous day’s retreat from an all-time high (ATH) by rising 0.70% intraday to $3,655 at the latest.
- Bitcoin (BTC) hits a two-week high, up more than 2.0% intraday to $114,100 as we write.
- Ethereum (ETH) jumps 3.0%, breaks weekly inaction while rising to $4,443 by press time.
- U.S. Dollar Index (DXY) drops back, mildly offered near 97.60 after bouncing off a six-week low the previous day.
- Wall Street edges higher, with Dow Jones struggling, but Nasdaq and S&P 500 both staying firmer around the record tops.
- WTI Crude Oil posts a three-day winning streak, up 1.00% intraday to $63.40 at the latest.
Adobe Earnings, Qualitative Catalysts Eyed…
Moving on, traders face a busy day as global authorities respond to fresh geopolitical tensions in Doha and Poland, collateral damage from the Russia-Ukraine and Israel-Hamas wars. Focus will be on Adobe’s earnings, moves in bond yields, and political/trade developments linked to Donald Trump. It’s worth noting, however, that a lack of economic data left for publishing could join a cautious mood ahead of Thursday’s U.S. CPI to challenge the momentum of traders, allowing markets to defend the latest moves.
Also read: Cryptocurrency Weekly Price Prediction: BTC, XRP Rebound, But ETH Lags, amid Fed Rate Cut Buzz
