Overnight – Powell releases the Bulls as rate cuts flagged at Jackson Hole

Stocks rallied on Friday as dovish remarks from U.S. Federal Reserve Chair Jerome Powell solidified expectations that the central bank will cut its key policy rate in September.

In highly anticipated comments before the Jackson Hole Economic Symposium, Powell said “the time has come” to lower the Fed funds target rate, and “the upside risks of inflation have diminished.” “We do not see or welcome further weakening in labour market conditions,” Powell added in a speech that appeared to all but guarantee a rate cut at next month’s policy meeting, which would be the first such cut in over four years.

All three major U.S. stock indexes jumped after the release of Powell’s prepared remarks, with megacaps Nvidia, Apple and Tesla providing the most muscle. Small caps and regional banks were outperformers, rising 3.2% and 4.9%, respectively.

All three indexes logged weekly advances, standing on the shoulders of last week’s largest Friday-to-Friday percentage gains of the year.

Next week, the data-dependent Fed will have a raft of economic indicators to consider ahead of its September rate decision, including the Commerce Department’s revised second-quarter GDP and its broad-ranging Personal Consumption Expenditures (PCE) report, which includes the Fed’s preferred inflation yardstick, the PCE price index.

Robert F. Kennedy Jr. suspending his U.S. presidential campaign on Friday and endorsed Republican presidential candidate Donald Trump. Kennedy said his name would remain on the ballot in most states, stressing that he was merely suspending not terminating his campaign