Traders work on the floor of the New York Stock Exchange (NYSE) on November 20, 2025 in New York City.
Spencer Platt | Getty Images News | Getty Images
U.S. equities rebounded Friday after New York Federal Reserve President John Williams suggested the central bank could cut rates again in December.
The Dow Jones Industrial Average gained 506 points, or 1.1%. The S&P 500 gained 0.9%, while the Nasdaq Composite advanced 0.6%.
The comments by a notable Fed member like Williams led traders to raise their bets that the central bank would in fact cut next month for the third time this year. Fed funds futures are currently pricing in a more than 70% chance of a quarter percentage point cut, a spike from the 39.1% likelihood priced in the day before, according to the CME FedWatch tool.
“I view monetary policy as being modestly restrictive, although somewhat less so than before our recent actions,” Williams said in remarks for a speech in Santiago, Chile. “Therefore, I still see room for a further adjustment in the near term to the target range for the federal funds rate to move the stance of policy closer to the range of neutral, thereby maintaining the balance between the achievement of our two goals.”
Stocks that could benefit the most from lower rates, which may spur consumer spending, led the market comeback. These included Home Depot, Starbucks and McDonald’s. Investors hope easier monetary policy can revive a sluggish economy and justify historically high tech-stock valuations.
“We think there definitely should be a cut,” Jay Hatfield, Infrastructure Capital Advisors founder and CEO, said in an interview with CNBC. “It’s going to depend on the next … employment report. It would have to be pretty weak, I think, to convince people to cut.”
Wall Street is coming off a brutal market reversal in the last session. The Dow at one point on Thursday rose more than 700 points as investors cheered a blockbuster Nvidia fiscal third-quarter earnings report. The benchmark, along with the S&P 500 and Nasdaq Composite, ended the day sharply lower as the Nvidia rally fizzled and worries grew that the Fed would stand pat in December on rates.
Even with Friday’s moves, the three major averages are still headed for big losses this week. The S&P 500 is down around 2% week to date, as is the 30-stock Dow. The Nasdaq has shed about 3%.
When speaking about the recent pressure, Hatfield believes that “this is a normal, seasonal, post-earnings valuation pullback,” adding that “the bubbles portion of the market [is] getting annihilated.”
That includes bitcoin, which dropped roughly 2% Friday, putting its week-to-date losses at more than 10%. The cryptocurrency has fallen to levels not seen since April as investors have pulled back on their risk-taking in the market.
“The only real question is, ‘Where do we bottom out at?'” the CEO said about the broader market.
