The Federal Reserve announced a significant 50 basis point rate cut and hinted at another 50 basis points cut later this year, but the financial markets failed to maintain the trend after the rate cut decision was announced. U.S. stocks rose and then fell, with major stock indexes turning downward, and gold, which had risen more than 1% to a record high, also fell. The price of U.S. Treasuries fell, and the yield on U.S. Treasuries, which had plunged in midday trading, rose.

The Federal Reserve announced after Wednesday's meeting.It was the first rate cut in four years and an unconventional 50 basis point cut, with only one dissenter among the voting members. The dot plot shows that slightly more than half of the policymakers expect at least 25 basis points cut at each of the remaining two meetings this year. The decision statement added a commitment to support full employment and expressed more confidence in achieving the inflation target, calling the risks to both employment and inflation generally balanced and noting that employment growth has slowed. The "New Federal Reserve News Agency" commented that this reduction is larger than most analysts expected a few days ago, and that the Fed has entered a new phase of fighting inflation to prevent previous rate hikes from further weakening the labor market.

But after the Federal Reserve announced the rate cut, Federal Reserve ChairmanPowell's statement at the press conferencedid not provide a strong dovish signal, but expressed caution about continuing to cut rates significantly, warning against seeing large rate cuts as a routine rhythm for the future. He said the Fed was not in a hurry to complete rate cuts and that data would drive monetary policy choices, with rate cuts accelerating, slowing down or pausing as needed. Some commentaries have suggested that the subsequent decline in U.S. stocks was due to traders "selling the fact," and that Powell's hints did not indicate an urgent need for monetary easing. However, since aggressive easing is often related to economic pressure, the Fed's lack of urgency to take action may not be bad news.

After the Federal Reserve announced a 50 basis point rate cut, the three major stock indexes jumped, with the Nasdaq up nearly 1.2%, the Dow Jones up more than 370 points or 0.9%, and the gains gradually eroded during Powell's press conference. After the press conference, the three major indexes of U.S. stocks turned downward, with the S&P ending its seven-day rally and the Dow continuing to fall from Tuesday's record closing high, while small-cap stocks had a thrilling six-day rally.

• The three major U.S. indices: The S&P 500 index fell 0.29%, closing at 5618.26. The Dow Jones Industrial Average, which is closely related to the economic cycle, fell 103.08 points, a decrease of 0.25%, closing at 41503.10 points. The Nasdaq Composite Index, which is dominated by technology stocks (Nasdaq), fell 54.76 points, a decrease of 0.31%, closing at 17573.30 points.

• Small-cap and technology stock indices: The Russell 2000, which is mainly composed of value stocks, rose 0.04%, marking its sixth consecutive increase and reaching a new high since August 30th. The Nasdaq 100 Index, which is dominated by technology stocks, fell 0.45%. The Nasdaq Technology Market Cap Weighted Index (NDXTMC), which measures the performance of technology stocks in the Nasdaq 100 Index, also fell 0.45%. Both fell after a rebound on Tuesday. The VIX fear index rose 3.52%, closing at 18.23.

• Dow Jones and S&P sectors: Among the Dow Jones components, Intel led the decline, falling more than 3%. Honeywell, Visa, American Express, and Procter & Gamble fell more than 1%, while Apple rose 1.8%, performing the best. Among the major sectors of the S&P 500, only energy rose nearly 0.3% and communications services rose slightly, while utilities fell nearly 0.8%, and the IT sector, including chip stocks such as NVIDIA, fell more than 0.5%.

• "Big Seven" of U.S. stocks: Including Microsoft, Apple, NVIDIA, Google parent company Alphabet, Amazon, Meta (formerly Facebook), and Tesla, the technology giants of the "Big Seven" had mixed performance at the close. NVIDIA fell by about 1.9%, continuing its four-day decline and hitting a new low since September 10th on Tuesday. Microsoft fell by 1%, while Tesla and Amazon fell by no more than 0.29%. Meta and Google A, on the other hand, rose by at least 0.3%, and Apple rose by 1.8%.

• Chip stocks: The Philadelphia Semiconductor Index, which saw a difficult rebound on Tuesday, fell 1.08%, closing at 4859.29. Among its components, Intel led the decline, with Wolfspeed falling by 3.02% and ASML Holding ADR being the third largest decliner. NVIDIA, AMD, and Micron Technology were among the leading decliners. Among the four component stocks that rose, Graphcore rose by 0.18% and Lattice Semiconductor (LSCC) rose by 1.66%, showing the second best performance, while Coherent (COHR) rose by 3.93%.

• China concept stocks: Overall, Chinese concept stocks fell, with the Nasdaq Golden Dragon China Index falling 0.86%, closing at 5639.37. Among the popular Chinese concept stocks, NIO fell by 7%, DiDi fell by 6%, XPeng fell by 4%, Li Auto fell by 3%, and Bilibili fell by 2%. Among the ETFs, the China Technology Index ETF (CQQQ) fell 1.04% and the China Internet Index ETF (KWEB) fell 0.58%.

Investors restrained risk appetite before the announcement of the Fed's decision, and the pan-European stock indexes that rebounded on Tuesday fell back.

• Major stock indexes: The Stoxx 600 index, which hit a high since September 3 on Tuesday, fell 0.50%. Major European national stock indexes fell together on Wednesday.

• Sectors and individual stocks: Among the sectors of the Stoxx 600, the food and beverage sector led the decline, with a 1% decrease. Italian wine company Campari, which announced its resignation due to personal reasons five months after the CEO took office, fell 7.5%. The healthcare sector fell by about 0.7%, with component stocks. After the media reported that its weight loss drug semaglutide is likely to be included in the next batch of discounted drugs in the United States, Novo Nordisk, the largest pharmaceutical company in Europe, fell by about 2.4%.

After the Fed's interest rate cut, US bond yields collectively declined. Fed Chairman Powell then held a press conference and ushered in a V-shaped reversal, with the yield of long-term US bonds leading the increase.

• 10-year US Treasury Bond: The yield on the benchmark 10-year US Treasury bond quickly fell below 3.70% after the Fed's interest rate cut, erasing its intraday gains and turning lower. At the beginning of Powell's press conference, it hit a daily low of 3.6325%, rose above 3.70% during the conference, and hit a daily high of 3.7188% at the end of the US stock market, rising more than 7 basis points intraday, breaking away from the low since June 2022 that was set after falling below 3.60% on Tuesday. By the end of the bond market, it was about 3.70%, rising more than 5 basis points intraday, and the yields of other maturity US Treasury bonds rose for two consecutive days after falling for two consecutive days.

• 2-year US Treasury Bond: The yield on the more interest rate-sensitive 2-year US Treasury bond hit a daily high of 3.6590% before the Fed announced the interest rate cut, quickly falling below 3.60% after the announcement. Before Powell's press conference, it fell below 3.54% to 3.5377%, falling more than 12 basis points from the daily high, and it rose after hitting 3.60% during Powell's press conference, temporarily erasing the intraday decline. It rose above 3.63% at the end of the US stock market. By the end of the bond market, it was about 3.62%, rising nearly 2 basis points intraday.

After the Fed's rate cut, the US dollar index fell to a 14-month low, and after the press conference, it turned higher; after the Fed's rate cut, the offshore renminbi rose more than 400 points in intraday trading, breaking through 7.07 to reach a 15-month high, and bitcoin rose more than 2000 dollars intraday, breaking through the 0.061 million mark before turning lower.

• US Dollar Index: The ICE Dollar Index (DXY), which tracks the US dollar against a basket of six major currencies including the euro, saw its decline rapidly expand after the Fed's rate cut, initially falling to 100.215 at the start of Powell's press conference, hitting its lowest level since July 20, 2023, dropping nearly 0.7% intraday. It then continued to rebound, with the US stock market turning higher in the afternoon and hitting a high of 101.146, rising more than 0.9% from its low, to slightly below 101.00 at the forex market close.

• Non-US Currency: The yen, which ended its four-day rally on Tuesday, rebounded after the Fed's rate cut, rising more than 1% at one point. The dollar against the yen accelerated its decline after the Fed's decision, falling to 140.45 at noon, hitting a daily low, dropping nearly 1.4% intraday, before rebounding and briefly turning higher, hitting a daily high of 142.71. The euro against the dollar, after approaching 1.1190 following the Fed's rate cut, hit its highest level since August 28, and then gave back most of its gains.

• Renminbi: The offshore renminbi (CNH) against the US dollar rose to 7.0696 at midday after the Fed's rate cut and Powell's press conference, hitting its highest level since June 2, 2023, rising 414 points intraday. It then gradually gave back more than half of the gains. At 4:59 AM on September 19, Beijing time, the offshore renminbi against the US dollar was reported at 7.0954 yuan, up 156 points from the New York closing bell on Tuesday, rebounding after ending its four-day rally.

• Bitcoin: Bitcoin (BTC) fell below 0.0593 million US dollars near midday to hit a daily low, and then accelerated its rise after the Fed's rate cut, rising above 0.0613 million US dollars at midday to hit a new daily high, approaching the high since August 27, and rising more than 2000 US dollars, up over 3% from its low. It quickly fell below 0.061 million US dollars and gave back some of its gains, remaining at least above 0.0601 million US dollars after the close of the US stock market, with a slight turn lower in the last 24 hours.

Crude oil saw a pause after two consecutive gains, with US oil falling from its high of the month, despite the US Department of Energy's announcement of a larger-than-expected drop in crude oil inventories last week during the early trading session and the Fed's announcement of a rate cut at midday, both instances briefly leading to a turnaround in oil prices.

• Crude oil intraday: International crude oil futures fell for most of the time on Wednesday. When European stocks hit a daily low in early trading, US WTI crude oil fell to $69.73, a drop of nearly 2.1% intraday. Brent crude oil fell to $72.31, a drop of nearly 1.9% intraday. After that, there was a rebound after the shock. US stocks rallied in early trading and briefly turned positive at noon after the US Federal Reserve announced an interest rate cut.

• Crude oil closing: Crude oil closed lower after two consecutive days of gains. On Tuesday, WTI October crude oil futures, which hit a closing high since August 30, fell $0.28, a decrease of more than 0.39%, to $70.91 per barrel. Brent November crude oil futures, which hit a high since September 3 for two consecutive days, fell $0.05, a decrease of approximately 0.07%, to $73.65 per barrel.

After the US Federal Reserve cut interest rates, gold rose more than 1% during trading, but fell during Powell's press conference.

After the US Federal Reserve announced its decision, gold rose during midday trading and hit a new intraday record high on Monday. New York gold futures rose to $2627.2, up more than 1.3% intraday, and spot gold rose to $2600.16, up nearly 1.2% intraday. However, it continued to fall during Powell's press conference. By the closing of the US stock market, COMEX December gold futures, which had fallen for two consecutive sessions, rose 0.24% to $2598.6 per ounce.

Gold prices fell during midday trading in the US stock market, with December futures falling to $2572.5 per ounce, a drop of nearly 0.8% intraday, and spot gold falling to $2547.16, a drop of nearly 0.9% intraday.

Editor / jayden