| Name | Price | Change | % Chg |
|---|---|---|---|
| Dow | 45,282.47 | -349.27 | -0.77% |
| S&P 500 | 6,439.32 | -27.59 | -0.43% |
| Nasdaq | 21,449.29 | -47.24 | -0.22% |
| VIX | 14.79 | 0.57 | 4.01% |
| Gold | 3,397.80 | -19.7 | -0.58% |
| Oil | 64.71 | -0.09 | -0.14% |
OVERVIEW OF THE US MARKET
US stocks slipped and bond yields climbed as optimism over imminent Federal Reserve rate cuts lost steam ahead of a key inflation report. Markets had surged after Jerome Powell signaled a likely September cut at Jackson Hole, but doubts remain about the pace of easing given sticky inflation and labor market weakness.
The Fed’s preferred inflation gauge, core PCE, is expected to rise 2.9% year-on-year, its fastest pace in five months, complicating policy decisions. Policymakers face the dilemma of balancing inflation still above target with slowing job growth, leaving investors uncertain about the trajectory of monetary policy.
The S&P 500 fell 0.4% with around 400 stocks declining, though Nvidia advanced before results and Alphabet hit a record high. The 10-year Treasury yield rose to 4.28%, while the dollar gained. Traders still see an 80% chance of a September cut and two reductions in total for 2025, but October and December remain data-dependent.
Analysts stressed the importance of distinguishing between a “dovish cut” and a “hawkish cut,” with labor market risks viewed as more pressing than inflation at present. Leadership changes at the Fed could tilt policy more accommodative over time, though President Trump’s decision on Powell’s successor is months away.
Strategists expect Powell to push for easing unless labor data rebounds strongly or inflation accelerates. UBS anticipates four cuts through January 2026. Meanwhile, Fed officials are set to speak this week, offering more guidance on policy direction. Rate cuts are seen as supportive for bonds and small caps, which benefit from lower borrowing costs.
Beyond macro concerns, attention turns to Nvidia’s earnings, a pivotal test for the AI-driven rally. With its stock up nearly 90% since April and accounting for 8% of the S&P 500, Nvidia’s results could determine whether tech momentum continues or valuations face pressure. Analysts caution that Big Tech’s dominance raises market concentration risks, though robust profitability justifies valuations.
Corporate headlines added to market chatter: Elon Musk sued Apple and OpenAI over AI competition; Buffett ruled out a railroad acquisition; Trump’s administration blocked offshore wind projects and launched a tariff probe on furniture; Keurig Dr Pepper agreed to buy JDE Peet’s for $18.4 billion; and Nvidia, Puma, American Eagle, and others made notable stock moves.
Overall, markets are caught between optimism over Fed easing and concerns about inflation, labor market fragility, and heavy reliance on tech giants to sustain equity gains.
OVERVIEW OF THE AUSTRALIAN MARKET
Australia’s share market edged to a new intraday high on August 25, 2025, but closed modestly higher as strong resource gains offset consumer and financial drags, resetting amid Fed Chair Powell’s Jackson Hole speech signaling September cuts despite tariff pressures, with 89% odds per futures—potentially easing global volatility alongside promising US-Russia-Ukraine peace talks advancing a trilateral meeting. The S&P/ASX 200 rose 0.06%, or 5 points, to 8,972.4, while the broader All Ordinaries gained 0.12% to 9,245.0. Advancers outpaced decliners 193 to 87 on the S&P/ASX 300, showing resilience despite reversal from highs.
Six sectors advanced, led by Materials (+2.72%) on iron ore majors and broad commodity strength—gold, silver, uranium, lithium, critical minerals—and Energy (+1.12%). Financials -1.18%: banks soggy. Consumer Discretionary -0.91%, Consumer Staples -0.78%. Materials: BHP (+2.7%), Rio Tinto (+1.0%) after Trump-backed US copper project. Energy: uranium boost—Boss Energy (+2.8%), Paladin Energy (+4.3%), Deep Yellow (+3.8%) after approvals.
Standouts: Locksley Resources (+42.2%) partnership, Aussie Broadband (+20.2%) FY25 results, LTR Pharma (+18.2%) update. Decliners: IPD Group (-27.8%) Q1 miss, Skycity Entertainment Group (-24.6%) raise, James Hardie Industries (-9.4%) continued reaction.
August PMIs expanded (Composite 54.9), aligning RBA easing post-3.60% cut. US jobless above poll, Philly miss, PMIs/Home Sales beat. Aussie +0.16% to 65.02 US cents. IG Markets’ Tony Sycamore notes reset for valuations near highs, with BHP, Rio tomorrow.
AMP’s Oliver sees easing positive sans recession, but volatility from valuations/Trump wars. FCC’s push to abolish TV ownership caps, enabling Nexstar’s $6.2B Tegna deal vs. Big Tech, debated as congressional domain. Journal study: P/E 75% returns-driven, urging discount focus amid records.