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Could Powell speech tonight calm treasury market and fuel stock market rally?

4/18/2025 11:23am

``` The deep research logic is organized as follows: Okay, let's tackle this question. The user is asking whether Powell's speech tonight (April 17, 2025) will calm the treasury market and fuel a stock market rally. First, I need to look at the references provided. The key points from the references indicate that Powell's speech on April 16 (which is the day before the current time of April 17) had significant impacts. From references 1, 7, 8, 9, 10, 11, 12, 13, 14, 15, 16, 17, 18, 19, 20, 21, 22, 23, 24, 25, 26, 27, it's clear that Powell's comments about tariffs causing potential inflation and slowing growth led to a drop in treasury yields and a stock market decline. Wait, the user is asking about a speech "tonight," which would be April 17, but the references mention speeches on April 16 and 17. For example, reference 11 is dated April 17, where Powell defends Fed independence. Reference 12 is April 17, with Trump's reaction. Reference 13 is April 17, Powell's warning. Reference 14 is April 17, Trump's warning. Reference 15 is a query about the April 17 transcript. Reference 16 is April 17, Trump's playbook. Reference 17 is April 17, Treasury Secretary's warning. Reference 18 is April 17, Trump's frustration. Reference 19 is April 17, treasury yield update. Reference 20 is a query about the treasury market reaction on April 17. Reference 21 is April 17, Powell's warning. Reference 22 is April 17, stock market tumble. Reference 23 is a query about stock market rally or decline on April 17. Reference 24 is April 17, Trump's call for Powell's removal. Reference 25 is April 17, Trump's call for rate cuts. Reference 26 is a query about monetary policy signals in Powell's April 17 speech. Reference 27 is a query about analyst commentary on the impact. So, the speech in question is likely the one on April 17. However, the user is asking if the speech "tonight" (April 17) will calm the treasury market and fuel a stock rally. But according to the references, the market reaction on April 17 was negative. For example, reference 19 mentions that the 10-year Treasury yield fell to 4.279% on April 17, but the stock market dropped (reference 22: Dow down 700 points, S&P 500 down 2.24%, Nasdaq down 3.07%). Reference 23's query results show significant stock price changes, but the overall market trend was downward. Wait, the user is asking if the speech will calm the treasury market (i.e., reduce volatility or stabilize yields) and fuel a stock rally. However, based on the references, the speech led to further declines in the stock market and continued drops in treasury yields. For example, reference 19 states that the 10-year Treasury yield fell for the third consecutive day, hitting 4.263% before ending at 4.279%. The stock market reacted negatively, with the Nasdaq Composite down 3.07% (reference 22). So, the answer would be that the speech did not calm the treasury market but continued to affect it negatively, and the stock market declined rather than rallied. However, the user is asking if it will "calm" the treasury market and "fuel" a rally. The answer would be no, based on the data. But wait, the user's question is about the potential effect of the speech. The references show that the speech led to further declines, so the answer would be that the speech is unlikely to calm the treasury market and fuel a rally. Instead, it exacerbated market volatility and led to further declines in stocks and continued drops in treasury yields. Additionally, considering the user's interest in the NASDAQ Composite (which is tech-heavy), the negative impact on tech stocks (as mentioned in reference 22, Nasdaq down 3.07%) aligns with the user's portfolio focus. The user's short to medium-term horizon means they might be concerned about near-term volatility. So, the conclusion is that Powell's speech did not calm the treasury market or fuel a stock rally. Instead, it heightened concerns about inflation and growth, leading to continued treasury yield declines and stock market declines, particularly in tech-heavy indices like the NASDAQ. ``` **Concluding Statement:** Based on Jerome Powell's April 17, 2025, speech and subsequent market reactions, the Federal Reserve's cautious stance on monetary policy, coupled with concerns over tariff-induced inflation and growth headwinds, is unlikely to calm the Treasury market or fuel a stock market rally in the near term. Instead, the speech has amplified volatility and reinforced bearish sentiment across risk assets, particularly tech-heavy indices like the NASDAQ Composite, which aligns with your portfolio focus. --- ### **Analysis of Powell's Speech and Market Impact** 1. **Treasury Market Reaction** - Powell's warning that tariffs could create a "challenging scenario" where the Fed's dual mandate (price stability vs. maximum employment) is in tension has deepened uncertainty. This has driven Treasury yields lower, as investors seek safety amid fears of slower growth and persistent inflation . - The 10-year Treasury yield fell to **4.279%** on April 17, marking its third consecutive daily decline . This reflects heightened risk-off sentiment and expectations of prolonged policy观望 (wait-and-see mode) . - 2. **Stock Market Volatility** - The S&P 500 dropped **2.24%**, the Dow fell **1.73%**, and the NASDAQ Composite declined **3.07%** on April 17 . Tech stocks, which you track closely, were hit hardest due to concerns about higher input costs and reduced consumer discretionary spending from tariffs . - Powell's emphasis on "continued volatility" in markets and his reluctance to signal imminent rate cuts have dampened hopes for a near-term rally. Investors are pricing in the risk of prolonged inflationary pressures and slower GDP growth . - |code|Ticker|Name|Date|Closing Price|market_code| |---|---|---|---|---|---| |SPY|SPY.P|SPDR S&P 500 ETF Trust|20250417|526.41|169| 3. **Macro Risks and Policy Dilemma** - **Tariff Impact**: The surge in imports to avoid tariffs (as seen in March's 1.4% retail sales jump ) is expected to reverse, further weighing on GDP estimates . - **Inflation Concerns**: Powell noted that tariff-driven inflation could be "more persistent than historically observed" , raising the bar for Fed rate cuts. - **Political Pressure**: Trump's criticism of Powell as "Too Late Jerome" and calls for his removal add noise, but Fed independence remains intact under current legal frameworks . --- ### **Key Takeaways for Investors** - **Treasury Market**: Expect continued downward pressure on yields, with the 10-year Treasury likely to test support near **4.16%** (weekly Ichimoku Cloud boundary) . - **Stock Market**: The NASDAQ Composite faces headwinds from tech sector sensitivity to rate policy and tariff risks. A sustained rally requires clearer signs of inflation moderation or Fed dovishness, neither of which emerged from Powell's speech. - **Near-Term Strategy**: Monitor the April 27 GDP release and May 2 FOMC meeting for clearer signals. High-risk assets like tech stocks may remain volatile until the tariff policy outlook stabilizes. --- ### **Final Assessment** Powell's speech has reinforced the Fed's cautious approach, which is unlikely to calm the Treasury market or trigger a stock rally. Investors should brace for continued volatility, particularly in tech-driven indices like the NASDAQ, as the interplay between tariff risks, inflation, and monetary policy remains unresolved. A pivot to risk-on sentiment would require a material easing of inflation pressures or a shift in Fed rhetoric, neither of which appears imminent.