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🔥 The Federal Reserve's late-night surprise interest rate cut creates a stark contrast in the market!
At 2 a.m. Beijing time on December 11, the Federal Reserve announced a 25 basis point rate cut to 3.5%-3.75%, marking the third consecutive time it has "loosened the reins." Behind the resolution, there are undercurrents, with three out of twelve committee members actually opposing it, a rare disagreement. Weak employment data is the main reason, as initial jobless claims soared to 236,000, reaching a three-year high.
Market reactions are split: the Dow Jones surged 1.34% to a new high, while the Nasdaq fell 0.25%. Oracle's earnings report shocked the market, with a market value evaporating by $68.8 billion, dragging down tech stocks. Meanwhile, gold and silver soared, with silver breaking through the historical high of $64, as funds flowed into safe-haven assets.
Even more significant, the Federal Reserve announced it would purchase $40 billion in short-term bonds, initiating a "covert balance sheet expansion," reigniting the liquidity storm. The dollar fell sharply, while the euro rebounded. Asian markets were lifted, with the yuan breaking 7.05, as Chinese assets welcomed a window of opportunity.
Powell stated that the path is uncertain, and there might only be one rate cut in 2026. However, market dynamics have quietly shifted: tech giants are accelerating the AI race, with OpenAI releasing GPT-5.2, and Disney investing $1 billion in joint ventures. The first light of dawn appears on Wall Street, but the real storm may just be beginning.
