TL;DR

Powell signals September rate cut; equities and crypto rally; Walmart profit hit by tariffs.

Highlights

• Fed Chair Powell signals a likely September rate cut, citing labor-market risks; Fed-funds futures price in a 90% chance 1.
• Equities rally: Dow hits record high (+900 pts), S&P 500 up 1.5%, Russell 2000 surges 4% with broad sector participation 12.
• Bitcoin jumps above $117,000 3; Ethereum nears record high ($4,800+) 4; crypto market cap approaches $4T amid risk-on sentiment 3.
• VanEck files for first US Solana staking ETF 10; Bitwise completes first in-kind creation for spot Bitcoin ETF, improving ETF efficiency 11.
• Apple and Alphabet gain as Apple considers licensing Google’s Gemini AI for Siri overhaul 5.
• Nvidia introduces Spectrum-XGS Ethernet for linking data centers; CoreWeave to deploy in AI infrastructure 16.
• Walmart misses profit estimates due to tariff-driven margin pressure, despite strong revenue and raised full-year guidance; shares fall ~4% 6.
• CBO projects Trump tariffs could cut US deficit by $4T over 10 years, but warns of consumer income losses and trade risks 20.
• Canada rolls back most retaliatory tariffs on US goods, except for steel and autos, easing some trade tensions 7.
• President Trump signals further delay to TikTok ban as US buyers emerge; sets two-week deadline for Russia sanctions/tariffs decision 812.
• Pentagon authorizes armed National Guard patrols in Washington, D.C.; Defense Intelligence Agency chief dismissed after Iran assessment leak 1813.
• UBS raises 2025 S&P 500 target to 6,600 on profit resilience but maintains a neutral stance 15.

Commentary

Markets are closing on strong risk-on momentum after Fed Chair Powell’s Jackson Hole remarks signaled a likely September rate cut, citing rising risks to the labor market despite inflation remaining above target 1. The shift to a more flexible inflation-targeting framework and clear openness to easing have driven a broad rally in equities, with small caps leading as the Russell 2000 outperformed large caps 2. The move is supported by a surge in Fed-funds futures pricing and a notable rotation into rate-sensitive and domestically focused stocks, including homebuilders and regional banks 2.

Crypto assets have responded sharply to the dovish Fed tone, with Bitcoin and Ethereum both posting outsized gains and pushing the total crypto market cap near $4 trillion 34. Structural developments—such as VanEck’s Solana staking ETF filing 10 and Bitwise’s in-kind ETF creation 11—are further supporting institutional flows and improving ETF mechanics, which could deepen liquidity and reduce costs for investors.

On the corporate side, Apple ’s potential adoption of Google ’s Gemini AI for Siri and Nvidia ’s new data center networking launch are notable for investors tracking the AI and semiconductor space, with both Apple and Alphabet shares reacting positively 516. Walmart ’s profit miss, attributed to tariff-driven margin pressure, highlights the real-world impact of ongoing trade policy, even as the company lifted its full-year outlook 6. The CBO’s projection that Trump’s tariffs could cut the US deficit by $4 trillion over a decade is significant, but the agency also warns of likely consumer income losses and potential diplomatic fallout if trade tensions persist 20.

Geopolitical and regulatory headlines remain active but have not derailed the risk rally. Canada’s rollback of most retaliatory tariffs removes some friction ahead of the 2026 USMCA review 7, while the White House’s moves on TikTok and Russia 812, and security developments in Washington, D.C. 1813, add headline risk but have not materially impacted broader sentiment. UBS’s S&P 500 target upgrade reflects confidence in profit resilience but also notes that valuations already embed a lot of optimism 15.