Powell Steadies the FED as Stocks and Crypto Brace for Uncertainty

The Federal Reserve cut interest rates by 25 basis points for the second consecutive meeting, lowering the benchmark range to 3.75%-4.00%. While markets had priced in the move, Chair Jerome Powell's tempered outlook rattled investor sentiment. U.S. equities opened strong but retreated after Powell dismissed December rate cuts as "far from certain." The S&P 500 and Dow slid 0.5%, while the Nasdaq eked out a 0.1% gain on tech resilience.

Nvidia surged to a record $5 trillion valuation amid Optimism over eased China trade restrictions. Yet broader markets faltered as Powell's caution signaled potential pause in the easing cycle. Rate-sensitive assets face renewed scrutiny as traders recalibrate expectations.

Divisions emerged within the FED, with Governor Stephen Miran advocating a 50bps cut against Kansas City President Jeff Schmid's dissent. The rift highlights policy challenges amid incomplete economic data during the ongoing government shutdown.