TL;DR

Powell signals September rate cut; equities, crypto rally; new tariffs hit furniture stocks.

Highlights

• Fed Chair Powell signals a likely September rate cut; equities hit record highs, Treasury yields drop, and VIX falls 14%1.
• Fitch affirms US AA+ rating but warns tariffs and spending cuts will slow 2026 GDP growth to 1.5%; S&P maintains AA+ with stable outlook2.
• Trump administration launches 50-day probe into imported furniture, signaling new tariffs; Wayfair, RH, Williams-Sonoma fall 7–9% after hours, La-Z-Boy rises3.
• US blocks new Venezuelan oil permits for non-US majors, but Chevron retains license to operate4.
• US government acquires a 10% nonvoting stake in Intel via CHIPS Act subsidies; Intel shares rise 6%5.
• Ethereum surges 15% to a record $4,880; renewed crypto momentum7.
• Multiple spot XRP ETF filings submitted to SEC as October review deadline approaches8.
• Meta licenses Midjourney technology to enhance AI image/video tools, intensifying competition in generative AI9.
• Paramount to cut 2,000–3,000 jobs by November post-Skydance merger; animation division excluded10.
• IRS halts layoffs, seeks rehires as crypto enforcement chief resigns ahead of increased digital asset filings13.
• Trump deploys 1,700 National Guard troops across 19 states for immigration enforcement11.
• DIA chief removed after Iran strike assessment leak; turnover continues in US national security leadership6.

Commentary

Markets closed higher after Fed Chair Powell’s Jackson Hole remarks signaled a likely September rate cut, with futures now pricing in an 85–90% probability1. The move pushed equities to new records, led by the Dow ’s 1.9% rally and a sharp drop in Treasury yields114. The Fed’s shift comes amid signs of a cooling labor market, even as inflation remains above target. This dovish tilt is providing near-term support for risk assets, though the macro backdrop remains complicated by policy uncertainty and ongoing trade actions1.

Fitch’s affirmation of the US AA+ rating, alongside S&P’s stable outlook, offers reassurance on credit quality but highlights concerns over tariffs and fiscal policy2. The Trump administration’s new probe into imported furniture and talk of fresh tariffs triggered steep after-hours declines in retailers with foreign supply chains, underscoring the market’s sensitivity to sector-specific trade risks3. Fitch’s warning that these policies could slow GDP growth to 1.5% in 2026 is a reminder that trade and fiscal shifts may weigh on the medium-term outlook2.

In energy, the US decision to block new Venezuelan oil permits for non-US majors while allowing Chevron to continue operations maintains pressure on Venezuela but preserves some US supply4. Meanwhile, the US government’s 10% nonvoting stake in Intel , combined with a new SoftBank investment, boosted Intel shares and signals continued federal support for domestic semiconductor capacity5.

Crypto assets saw renewed momentum, with Ethereum hitting a record high and a surge of spot XRP ETF filings ahead of the SEC’s October deadline78. The IRS’s halt to layoffs and push to rehire staff, following the resignation of its crypto enforcement chief, suggests regulators are preparing for a busy period of digital asset oversight13. In tech, Meta ’s licensing deal with Midjourney reflects ongoing investment in generative AI, likely to intensify competition among major players9.

Traders should monitor developments on Fed policy, tariff implementation, and regulatory moves in crypto and AI. Rate-sensitive sectors, supply chain-exposed equities, and digital assets remain most directly in focus for the next session.