US stocks gained on Friday ahead of Federal Reserve Chair Jerome Powell’s closely watched speech at the Jackson Hole policy symposium, with investors awaiting signals on the path of interest rates.
The Dow Jones Industrial Average rose 297 points, or 0.7%, while the S&P 500 added 0.3%.
The Nasdaq Composite was little changed, hovering near the flatline.
Market participants are looking for clarity from Powell on the Fed’s policy outlook.
According to the CME FedWatch tool, traders were pricing in a 75% probability of a quarter-point rate cut at the central bank’s September meeting.
The prospect of easing rates has recently boosted segments of the market that lagged this year’s rally, as investors rotated out of megacap technology stocks into small-cap and value shares.
However, a more hawkish tone from Powell could weigh on sentiment and stall the rebound.
Despite Friday’s early gains, all three major indexes remain on track for weekly losses.
The S&P 500 is down 1.2% week-to-date, the Nasdaq has dropped 2.4%, and the Dow is set for a decline of about 0.4%.
The Jackson Hole speech
Federal Reserve watchers face a pivotal day as Chair Jerome Powell is set to deliver remarks at the central bank’s annual policy symposium in Jackson Hole, Wyoming, at 10 am ET.
His speech comes at a high-stakes moment, with President Donald Trump and his allies maintaining public pressure on the Fed to cut interest rates.
Beyond the political backdrop, markets are keenly focused on Powell’s comments regarding the path of monetary policy.
According to CME’s FedWatch tool, futures pricing shows that expectations for a rate cut at the Fed’s September meeting have increased significantly in recent weeks.
Separately, the Justice Department confirmed it will investigate Fed Governor Lisa Cook.
DOJ attorney Ed Martin said in a letter Thursday that the probe follows a criminal referral from a White House official.
Federal Housing Finance Agency Director Bill Pulte has accused Cook of mortgage fraud.
UBS raises S&P target
UBS Global Wealth Management has lifted its year-end target for the S&P 500 for the second time in two months, citing corporate earnings strength, easing trade tensions, and growing expectations of interest rate cuts.
In a note dated August 21, the wealth management arm of UBS raised its forecast to 6,600 from 6,200, suggesting an upside of about 3.6% from the index’s last close of 6,370.17.
The firm had previously raised its target in late June to 6,200 from 6,000.
The move follows similar upgrades earlier this month from other major brokerages, including Citigroup and HSBC, as Wall Street strategists grow more confident about the resilience of the US market.
“The bull market is intact and stocks will likely rise over the next year,” UBS strategists said.
Still, they kept a “neutral” stance on US equities, cautioning that valuations remain elevated, optimism on trade may already be priced in, and near-term catalysts are limited.
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