Traders work on the floor at the New York Stock Exchange (NYSE) in New York City, U.S., August 21, 2025.
Brendan McDermid | Reuters
The Dow Jones Industrial Average rallied to an all-time high Friday after Federal Reserve Chair Jerome Powell signaled the central bank could begin easing monetary policy next month.
The Dow climbed 846.24 points, or 1.89%, reaching a fresh high and closing at a record level of 45,631.74. The S&P 500 rose 1.52% to end at 6,466.91. At its session high, the broad market index came within three points of its record. The Nasdaq Composite gained 1.88% and settled at 21,496.53.
Shares of megacap technology stocks soared on Powell’s comments. Nvidia added 1.7%, while Meta Platforms jumped more than 2%. Alphabet and Amazon each climbed more than 3%. Tesla shares jumped about 6%.
In a tepid speech at the central bank’s annual conclave in Jackson Hole, Wyo., Powell said that “the baseline outlook and the shifting balance of risks may warrant adjusting our policy stance.” The Fed chief added that “the balance of risks appear to be shifting” between the central bank’s dual mandate of full employment and stable prices. He cited “sweeping changes” in tax, trade and immigration policies.
Expectations for a quarter-point rate cut in September surged to roughly 83% following the speed from about 75% earlier in the week, according to the CME Group’s FedWatch tool.
“The bar is extremely high now for the Fed to leave rates unchanged in less than a month,” said Chris Zaccarelli, chief investment officer at Northlight Asset Management.
Friday’s performance came in contrast to much more downbeat market action this week. The major averages entered the session lower week to date due to pressure in megacap tech. The latest rally helped investors claw back most of the losses from earlier in the week.
For the week, 30-stock Dow advanced 1.5%, and the S&P 500 gained 0.3%, while the Nasdaq slipped 0.6%.
Read More: Stock market news for Aug. 22, 2025