A strong rally erupted on Friday on Wall Street shortly after Federal Reserve Chair Jerome Powell delivered a notably dovish message during his highly anticipated speech at Jackson Hole.
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Powell said the Fed is prepared to adjust its policy stance—a clear nod to potential interest rate cuts—in response to the sharp cooling in the labor market.
He also adopted a more tolerant tone on inflation risks stemming from trade tariffs, saying the Fed’s base case assumes these would result in one-off price increases, not a sustained inflation surge.
It was party time for markets. Every sector in the S&P 500 closed in the green, with consumer discretionary, real estate, industrials and materials each rising more than 2%.
The Dow Jones Industrial Average surged 2%, breaking to new all-time highs above 45,680. The S&P 500 gained 1.4%, closing …