Major indexes tick higher on hopes of a December Fed cut, while crypto markets plunge amid renewed AI-bubble fears.
NEW YORK — U.S. stocks turned higher Friday after a turbulent week, as fresh comments from a top Federal Reserve official fueled renewed optimism for an interest-rate cut in December.
The Nasdaq Composite rose 0.6%, while the S&P 500 and Dow Jones Industrial Average both gained about 0.5%. The modest rally comes after Thursday’s sharp sell-off, one of the most dramatic reversals in months.
Markets reacted strongly after New York Fed President John Williams said he sees room for a rate cut in the “near term,” prompting traders to boost expectations of a December cut to 75%, up from 40% just a day earlier. Williams’ remarks highlight a deeply divided Fed ahead of its final policy meeting of 2025.
BITCOIN TUMBLES — WORST MONTH SINCE THE 2022 CRYPTO CRASH
While equities found some relief, crypto markets sank further.
Bitcoin traded as low as $82,000, continuing a steep slide from its record highs just one month ago. It is now on pace for its worst monthly performance since the crypto meltdown of 2022, as concerns grow over whether AI-related speculation has spilled into digital assets.
Risk-off sentiment remains elevated across markets, with investors questioning whether AI-driven valuations are sustainable.
WALL STREET HEADING FOR A BRUTAL NOVEMBER
Even with Friday’s bounce, major U.S. indexes are still on track for weekly losses:
- S&P 500: down over 2% for the week
- Nasdaq: down over 3%, hitting its lowest level since September
- Dow: down more than 2%
The S&P 500 is now heading for its worst November since 2008, dragged lower by mounting worries of an AI-bubble, softening consumer sentiment, and volatile rate expectations.
Not even Nvidia’s blockbuster earnings on Wednesday — nor CEO Jensen Huang’s optimism — were enough to calm markets.
Investors will also get a final November reading of consumer confidence from the University of Michigan on Friday, after preliminary data showed sentiment near a three-year low. Several Fed officials are scheduled to speak later in the day, offering potential clues about the central bank’s next move.
