Week in Review & Preview

Like Neo finally seeing the Matrix for the first time, Federal Reserve Chair Jerome Powell experienced his "aha moment" at Jackson Hole on Friday, essentially telegraphing that rate cuts are coming while tiptoeing around the tariff-shaped elephant in the room. Markets treated his speech like a long-awaited Marvel movie trailer - everyone left the theater buzzing about what's coming next. Meanwhile, retail earnings painted a picture of corporate America playing defense against tariff pressures. At the same time, Bitcoin decided to take a breather from its rocket ship trajectory. This week ahead promises more thrills with Nvidia's earnings serving as the ultimate stress test for artificial intelligence euphoria.

Last Week's Market Scorecard

The market played a game of "will they or won't they" with Powell all week before his Jackson Hole speech sent indexes soaring like Taylor Swift concert tickets. The Standard and Poor's 500 finished essentially flat at 6,449 points, proving that even in 2025, standing still counts as progress. The Dow Jones Industrial Average managed a measly 0.08% gain to close at 44,946. In comparison, tech stocks showed their dramatic flair with Nvidia sliding 3.5% earlier in the week. Bitcoin retreated from its stratospheric heights, dropping 1.86% to settle at $115,360, because even digital gold needs a coffee break sometimes. The ten-year Treasury yield declined to 4.33%, as bond traders positioned for the Powell pivot that everyone saw coming except perhaps Powell himself until Friday.

Top News Headlings & Market Impacts

Jerome Powell's Jackson Hole Address Sets Stage for September Rate Cut (August 22): The Fed Chair delivered his final Jackson Hole speech with all the subtlety of a neon sign, stating that "conditions may warrant" interest rate adjustments while acknowledging the "balance of risks appears to be shifting." Markets interpreted this as Powell-speak for "September rate cuts are coming," with futures markets immediately pricing in a 91% probability of a quarter-point reduction. The Dow surged nearly 800 points following his remarks, proving that Wall Street still gets giddy over Fed dovishness like teenagers at a boy band concert.

Retailers Navigate Tariff Pressures with Mixed Results (August 19-22): Home Depot reversed course on its previous no-price-hike pledge, with executives citing "significantly higher" tariff rates since May. Walmart warned that costs continue rising weekly as inventory replenishment occurs at post-tariff price levels. At the same time, Target maintained its stance of raising prices only as a "last resort." The earnings reports revealed a corporate strategy of gradually passing tariff costs to consumers rather than absorbing them indefinitely, suggesting price increases will accelerate through the remainder of 2025.

Nvidia Earnings Anticipation Builds Amid Tech Volatility (August 27 Expected): The artificial intelligence darling faces its quarterly earnings test on Wednesday, with Wall Street expecting $46 billion in revenue and earnings per share around $1.01. Analysts raised price targets ahead of the announcement, with KeyBanc boosting its target to $215. However, some warned that expectations may be too high given geopolitical uncertainties around China's revenue. The earnings represent a crucial test for the broader artificial intelligence trade that has driven much of 2025's market gains.

Producer Price Inflation Surges to Three-Year High (August 14): Wholesale prices jumped 0.9% in July, the fastest monthly increase since June 2022, signaling that tariff pressures are finally filtering through the production chain. Core Producer Price Index rose 3.7% annually, the highest since March, suggesting businesses are beginning to pass along increased costs after months of absorbing tariff impacts. The surge exceeded economists' expectations of just 0.2% monthly growth, raising concerns about inflationary pressures building in the pipeline.

Housing Market Shows Resilience Despite Rate Environment (August 18-22): Mortgage rates held near ten-month lows around 6.59% for thirty-year conventional loans, providing some relief to potential homebuyers despite remaining well above pre-pandemic levels. Housing starts data showed modest improvement, though experts warn that meaningful affordability improvements require both lower rates and continued price moderation. The combination of elevated home prices near $435,300 nationally and mortgage rates above 6% continues to constrain buyer activity.

Volatility Index Signals Market Calm (August 22): The VIX dropped to 14.22, down from 16.60 the previous day, indicating diminished fear levels despite ongoing economic uncertainties. The decline suggests investors are growing more comfortable with the economic outlook, particularly following Powell's dovish Jackson Hole remarks. However, the relatively low volatility may also reflect complacency ahead of key events like Nvidia earnings and September Federal Open Market Committee decisions.

Gold & Metals

Gold demonstrated its safe-haven credentials by rising to $3,371 per ounce as of Friday close, gaining ground as Powell's dovish pivot reduced the opportunity cost of holding non-yielding assets. The precious metal has climbed 34.33% year-over-year, benefiting from Federal Reserve policy uncertainty and ongoing geopolitical tensions surrounding Ukraine peace negotiations. With futures markets now pricing in multiple rate cuts through year-end, gold appears positioned for further gains as real yields compress and inflation concerns persist from tariff policies.

Real-Estate Pulse

The housing market continues its delicate dance between affordability constraints and tentative buyer interest. Thirty-year mortgage rates stabilized near 6.59%, providing some relief from earlier highs above 7% but remaining significantly elevated compared to the sub-3% rates of 2020-2021. Home price growth has decelerated nationally, though the median sales price remains stubbornly near record highs of $435,300. Real Estate Investment Trusts face headwinds from both higher borrowing costs and potential recession fears, while homebuilders benefit from reduced competition as existing homeowners remain reluctant to sell and surrender their low-rate mortgages. The market awaits September's Federal Open Market Committee decision, as even modest rate relief could unlock pent-up demand from sidelined buyers.

Key Events Next Week

Key Earnings to Watch

Wrapping Up

As August draws to a close, markets find themselves in that sweet spot where dovish Fed signals meet artificial intelligence earnings anticipation - like finding the perfect avocado at the grocery store, it's rare but oh-so-satisfying when it happens. Powell's Jackson Hole performance essentially gave Wall Street the green light it's been waiting for, even as tariff-induced price pressures bubble beneath the surface like a pot of water that hasn't quite reached a boil yet. While retailers navigate the delicate art of passing along costs without alienating customers, and Nvidia prepares to either validate or devastate the artificial intelligence investment thesis, one thing remains certain: September promises to be anything but sleepy. Whether you're team rate cuts or team "wait and see," remember that markets have survived everything from disco fever to TikTok dances. They'll navigate whatever 2025 throws their way with characteristic resilience and the occasional dramatic flourish.