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39m ago

Markets Pause After Powell’s Dovish Signal as Nvidia Test Looms

Traders look to Nvidia’s earnings alongside the PCE inflation reading to judge whether the Fed’s hinted pivot toward easing will hold.

A dealer watches computer monitors near the screens showing the Korea Composite Stock Price Index (KOSPI), left, the foreign exchange rate between U.S. dollar and South Korean won and the Korean Securities Dealers Automated Quotations (KOSDAQ) at a dealing room of Hana Bank in Seoul, South Korea, Monday, Aug. 25, 2025. (AP Photo/Lee Jin-man)
U.S. dollar, Euro, Chinese Yuan, Canadian dollar, Turkish Lira and Pound banknotes are seen in this illustration taken May 4, 2025. REUTERS/Dado Ruvic/Illustration
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Overview

  • U.S. stock futures edged lower after Friday’s surge that sent the Dow to a record close, even as Asian shares extended gains and Treasury yields and the dollar eased.
  • After Powell’s Jackson Hole remarks, markets priced roughly an 80%–85% chance of a September quarter-point cut, and major brokerages including Barclays, BNP Paribas and Deutsche Bank shifted to forecasting a 25-basis-point move.
  • Nvidia reports Wednesday in a closely watched update for the AI trade, with options pricing pointing to a potential move of about 6% that could sway broader indexes.
  • Key U.S. data ahead include Friday’s PCE inflation report, where economists expect core PCE to tick up to 2.9% year over year, followed by next week’s nonfarm payrolls.
  • Fed officials and analysts cautioned that tariff-driven price pressures could complicate the path to easing, and investors are monitoring trade developments viewed as near-term inflation risks.