Jerome Powell, the destroyer of puts, delivered dovish remarks at Jackson Hole today, sending pretty much every asset except the U.S. Dollar higher. Small-caps led the way as firms like regional banks benefit significantly from a lower-rate environment. Let’s see what you missed. 👀

Today's issue covers the market’s reaction to Powell’s speech, broadening stock market participation, and why cyber stocks are in focus going into next week. 📰

Here’s the S&P 500 heatmap. 11 of 11 sectors closed green, with consumer discretionary (+1.93%) leading and utilities (+0.28%) lagging.

And here are the closing prices: 

Most bullish/bearish symbols on Stocktwits at the close: 📈 $SSYS, $MNTS, $BKKT, $SQNS, $WDAY 📉 $GEV, $UI, $IESC, $UWMC, $CLEU*

*If you’re a business and want to access this data via our API, email us.

After setting the table for a September cut at the July meeting, Fed Chairman Jerome Powell confirmed, in no uncertain terms, that the pivot is complete.

In the early part of his speech, he said, “The time has come for policy to adjust. The direction of travel is clear and the timing and pace of rate cuts will depend on incoming data, the evolving outlook, and the balance of risks.”

Some other noteworthy phrases include:

The paragraph below sums up his view on current conditions and how the Fed looks to navigate them going forward. 👇

The question now is not whether the Fed will cut but how quickly it will need to cut based on the economy’s trajectory. Currently, the market is pricing in 125 bps in cuts before the end of the year, which is significantly more aggressive than the Fed’s June projections. 🔮

What they agree on, however, is that the long-term ‘neutral rate’ is likely in the mid-3% range. However, the market’s expected path to get there is likely to thrash around with the economic data as it comes in, while the Fed takes a more measured approach to its communication and policy moves.

Market participants expect rate cuts to benefit stocks across the board, but the lower rate environment continues to drive strength in small-cap stocks, which are more leveraged to the level and path of interest rates.

Bullish analysts expect the gap between large-cap and small-cap performance to continue closing, which it did today, as the Russell 2000 rose over 3%. And the Stocktwits community seems to agree, as sentiment pushed into ‘extremely bullish’ territory during today’s move. 🐂

One of the bears’ primary arguments over the last year (and a few years) has been that the stock market has depended on some combination of the “Magnificent Seven” mega-cap stocks to keep it going.

That argument was still being made despite the significant broadening of participation this year, with sectors ranging from industrials to financials to healthcare all breaking out to new all-time highs. 🤷

Today’s ‘Chart of The Day’ should officially put that argument to bed, especially when paired with the Russell 2000’s latest run discussed above.

Below is a chart of the equal-weighted S&P 500 ETF ($RSP), which had broken above its 2021 highs earlier in the year but had been flirting with those levels consistently…leaving room for the bears to say it was bound to break down. 🙄

With the index now firmly above resistance and closing at new all-time highs, the bears will need to spend this weekend devising a fresh narrative to support their thesis.

For now, stock market bulls are enjoying opportunities on the long side, many of which we feature daily in our Chart Art Newsletter. Check it out! 😉

Oilfield services giant Halliburton is the latest cyberattack victim. In a Securities & Exchange Commission (SEC) filing, the company revealed that it discovered an unauthorized party had gained access to some of its systems. 😬

It’s the latest in a series of headline-grabbing hacks, with global cyberattacks rising 30% YoY during the second quarter.

As a result, investors are also heavily focused on the sector, with many patiently waiting for industry-focused vehicles like ETF $HACK to break out to new all-time highs. The chart is testing resistance near $68 for the third time in four years, and many expect it to break out. 🤞

Stocktwits sentiment is currently in ‘bullish territory,’ with many watching CrowdStrike’s earnings on Wednesday as a potential catalyst to set the industry’s direction. 🧐

If the company can provide an upbeat outlook like Palo Alto Networks did, traders will be looking for $HACK and other vehicles to make new highs through the end of the year. Given CrowdStrike’s latest self-inflicted wounds, investors will focus primarily on its comments about the industry’s performance instead of the company’s own.

Time will tell. But for now, it’s clear $HACK is back on traders’ radars! 🕵️

We’re joking, but not really. It’s that big of a deal, so we’re pulling out all the stops for “Nvidia Day" on Wednesday. 😆

Be sure to follow @Stocktwits on the platform and our socials (X, Instagram, YouTube) so you don’t miss out on all the action we’ve got planned ahead of the event! 🚨

🤩 Chart Art: The best trade ideas and analysis from the Stocktwits community

✉️ USPS proposes changes to save $3 billion per year, starting in 2025

💸 Here are the people who lost millions backing Musk’s Twitter takeover

👨‍💼 Nestle CEO Schneider was ousted after underperformance, sources say

🗳️ RFK Jr. says in court filing that he’s endorsing Trump, ending his presidential hopes

🛫 Delta chief operations officer departing for another company after just over a year on the job

🏘️ Real estate company helped to artificially inflate rents across America, Justice Department alleges

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