Stocks Find a Positive Footing After Powell Delivers a Cautious Message: Stock Market News Today

Stock Futures Rise Ahead of Powell's Speech: Stock Market News Today

In a volatile trading day, stocks held ground Friday afternoon after Federal Reserve Chairman Jerome Powell said the central bank was “ready to raise interest rates further” during his remarks at the annual Jackson Hole Economic Symposium in Wyoming.

Investors digested Powell’s comments in fits and starts, settling on a balanced reading of the speech. While acknowledging that inflation has come down from its peak, the Fed chief reiterated that prices remain “very high”, leaving the door open for the central bank to continue tightening monetary policy. In what some analysts have dubbed the Rorschach test, Powell’s comments inspired hawkish and dovish predictions for what comes next. Wall Street appears to have split the difference.

The S&P 500 (^GSPC) rose 0.7%, while the Dow Jones Industrial Average (^DJI) rose 0.8%. The Nasdaq Composite (^IXIC) rose 0.8%, as major averages found positive momentum after Powell delivered a dovish message about the fight to bring inflation back to its 2% target.

The turnaround on Wall Street follows Thursday’s slump when stocks closed lower across the board as the Nasdaq fell nearly 2%, giving up gains from an early rally spurred by a strong Nvidia (NVDA) earnings report.

Powell’s comments reinforced earlier comments by Boston Fed President Susan Collins — who spoke to Yahoo Finance’s Jennifer Schonberger in an interview from Jackson Hole — suggesting higher interest rates may be needed to tame inflation.

Last year, stocks sold off sharply during Powell’s speech in Jackson Hole, when he said the Fed would keep raising interest rates “until the job is done”. Since that speech, rates have risen by an additional 300 basis points, with the federal funds rate now at its highest level since 2001.

And with Powell signaling the possibility of further rate hikes, the bond market sent yields higher, with the yield on the 2-year Treasury note rising to 5.05%.

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