The U.S. stock market surged on Friday, August 22, with the Dow Jones Industrial Average climbing nearly 850 points to an all-time high after Federal Reserve Chair Jerome Powell hinted at a potential shift in monetary policy.
At the close of the session, the Dow Jones jumped 846.24 points (1.89%) to a record 45,631.74 points. The S&P 500 gained 1.52% to 6,466.91, coming within 3 points of its historic peak, while the Nasdaq Composite advanced 1.88% to 21,496.53.
Mega-cap tech stocks led the gains following Powell’s remarks. Nvidia added 1.7%, Meta Platforms climbed over 2%, while Alphabet and Amazon both surged more than 3%. Tesla stood out with a 6% rally.
Speaking at the Federal Reserve’s annual Jackson Hole symposium, Powell noted that “economic outlook and risk balance are evolving,” signaling a potential adjustment in policy stance to support growth. He pointed to major shifts in tax, trade, and immigration policies as factors influencing the Fed’s decision-making.
Market expectations for a 25-basis-point rate cut in September 2025 jumped to 83%, up from 75% earlier this week, according to the CME FedWatch tool.
Friday’s rally helped investors recover earlier losses, reversing the pessimism that weighed on markets during the week due to pressure from tech stocks. For the week, the Dow gained 1.5%, the S&P 500 added 0.3%, while the Nasdaq Composite slipped 0.6%.
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