Home / Business and Economy / Dow Soars to New Highs as Fed Signals Easing, Tech Rotation Looms
Dow Soars to New Highs as Fed Signals Easing, Tech Rotation Looms
24 Aug
Summary
- Dow Jones Industrial Average reaches new intraday and closing records
- Fed Chair Powell hints at possible rate cut in September
- Investors anticipate earnings reports from Nvidia, Dell, and Marvell
On Sunday, August 24th, 2025, U.S. equity futures were flat as investors looked ahead to a busy week of earnings reports and economic data. The Dow Jones Industrial Average had catapulted to new intraday and closing records the previous week, buoyed by Federal Reserve Chair Jerome Powell's comments at the annual Jackson Hole symposium.
In his widely anticipated speech, Powell signaled that the central bank could begin easing monetary policy as soon as next month. This sparked a jump in expectations for a quarter-point rate cut in September, from around 75% earlier in the week to about 84% according to the CME Group's FedWatch tool.
The prospect of a more dovish Fed has fueled a potential rotation trade, with investors moving out of high-flying tech stocks and into more cyclical and value-oriented sectors. "We have seen the ingredients of a potential rotation trade out of tech into more cyclical and value stocks, and so to the extent you do see more anticipation of a Fed easing cycle, that momentum trade out of tech can continue," said Adam Crisafulli, founder of Vital Knowledge.
Investors will be closely watching earnings reports from Nvidia, Dell, and Marvell this week, as these companies could play a key role in determining whether the tech rally is back on or if the rotation trade has further to go. Additionally, Friday's release of the July personal consumption expenditure price index, the Fed's preferred inflation gauge, will be closely monitored for clues on the central bank's future policy decisions.
