Wall street awaits Powell: Nerves, tech tumbles, and a pivot to safety

2 minutes read

22 August 2025

Wall street awaits Powell: Nerves, tech tumbles, and a pivot to safety

The clock ticks towards Jerome Powell’s Jackson Hole speech. On a typical Friday, Wall Street would be swashing through deals and digesting quarterly reports. Not today. Tech giants lost their shine, safe-haven stocks got a second look, and traders held their breath for a few words from the Federal Reserve Chair.

A week of caution and rotation

Stocks came under pressure even before the opening bell. Investors, wary after a hot stretch for tech, watched market leaders Apple and Nvidia stumble. Nvidia, now the world’s most valuable company, lost its momentum, not because of weak results, but because the market fears it may have run too far ahead. “The massive revenue surges and beats that became synonymous with Nvidia are becoming a thing of the past,” explained Reuters’ financial commentators, warning that all the future optimism might now be baked into the price.

Jacob Bourne from eMarketer summed up Wall Street’s view: “Despite rising competition, Nvidia continues to lead the AI landscape,” but he cautioned against believing in perpetual hyper-growth. Susannah Streeter of Hargreaves Lansdown added, “Nvidia’s high-end chips will remain in demand,” especially while industry titans pump billions into AI development.

As big tech stumbled, investors retreated to safer ground. Defensive favourites like Walmart rose 1.26%, while healthcare made a surprise comeback. UnitedHealth, buoyed by news of a Berkshire Hathaway stake, dashed ahead. Last week, healthcare was the only sector not in the red, posting a near 5% gain. Line graph showing major index percentage changes from August 18-22, 2025.

Powell’s words and the market’s mood

The true source of tension is not earnings, but expectations. Powell’s speech at Jackson Hole looms large over every trade. Evercore ISI analysts warned, “Powell’s speech could deliver stocks a rough patch if Wall Street finds his comments insufficiently dovish”. Deutsche Bank, in their recent note, cautioned that even a “balanced” Powell could rattle growth stocks if he doesn’t set clear course for a rate cut.

Federal Reserve officials stoked market nerves throughout the week. Beth Hammack, Cleveland’s Fed chief, declared, “I wouldn’t be willing to cut rates in September, based on the data available today”. Atlanta’s Raphael Bostic expects only one rate cut this year. Jeffrey Schmid of Kansas City remains “wary of inflation pressures.” This hawkish chorus made investors shift focus to defensive stocks and short-term bonds—places to hide from volatility.

BlackRock Investment Institute’s commentary highlights the mood: “Policy-driven volatility and supply-side constraints are pressuring growth, but we see AI supporting corporate earnings. U.S. valuations are backed by stronger earnings and profitability relative to other developed markets”.

The story of the day is not just about prices, charts, or forecasts, it’s about nervous anticipation. As one analyst quipped, “If Powell hints at more hikes, expect a rollercoaster.” For the moment, traders wait, watch, and hope for clarity.

Markets love certainty. In its absence, safety becomes the hero, and every word from Jackson Hole is ready to reshape the rest of August.

Disclaimer: The views and recommendations made above are those of individual analysts or brokerage companies, and not of Winvesta. We advise investors to check with certified experts before making any investment decisions.