23:00, Federal Reserve emergency bailout

Source: Wall Street Intelligence Circle

Intraday felt like a crisis, but by the close, it seemed like nothing happened.

Waking up, it looked as if nothing had occurred, but market sentiment was stretched to the limit:

- The US stock market edged up slightly, with the Dow Jones up 0.07%, the S&P 500 up 0.10%, and the Nasdaq up 0.14%—however, software stocks continued to be heavily hit, while large-cap stocks rose.

- Gold prices fell by 2% and broke below $4,900; silver prices successively broke through the 76, 75, and 74 levels.

- Bitcoin once fell to $66,000;

- The US Dollar Index first rose and then fell, forming a long upper shadow;

- Oil prices dropped 2% due to progress in negotiations with Iran.

Ultimately, US stocks remained safe, and the global markets appeared to be calm.

But intraday movements were thrilling: the Nasdaq once fell by 1%, and the S&P 500 also broke below its 100-day moving average—the decline seemed set to intensify—until a turning point at 11:00 PM (UTC+8), when gold, silver, US stocks, and bitcoin all rebounded from that moment.

During the same period, there was only one piece of news affecting the market—the Chicago Fed President Goolsbee stated on CNBC that if it can be proven that inflation is heading back toward the 2% target, there may be multiple rate cuts this year.

This is another example of a Fed official appearing on CNBC (which targets professional investors) at a crucial moment to compromise with the market. From the broadcast footage, it was once again an urgent video call, with a background board carrying the Chicago Fed logo behind Goolsbee, and the market movements being shown live on the TV screen. Goolsbee issued the Fed’s most aggressive signal this year: "there may be multiple rate cuts." Although there was a premise, the statement "multiple rate cuts" clearly sounds more dovish than the market-expected "two rate cuts."

The timing was also very well chosen, as many US institutional intraday risk models recalibrate at 11:00 PM (UTC+8).

Later, San Francisco Fed President Daly also spoke on recent market concerns about AI. Daly stated that although there is currently little evidence that artificial intelligence is fundamentally changing the US economy, she remains open to signs that new technology will have an impact (the implication being that AI hasn’t changed the economy yet, so don’t rush to revalue or trigger repricing).

The Fed’s remarks played a soothing role for the market, and the market itself was also recovering. Recently, we have seen many of these patterns: intraday it looks like a crash/surge is imminent, but by the close, the index is unchanged (as if nothing happened).