Heavyweight night: From the whole line pull to the whole line collapse, there was only a 5-hour gap between the release of CPI data and Powell's speech, but the encrypted GDP has gone through a fluctuation of 20 billion US dollars.

Stimulated by the good news on August 30, the three major US stock indexes opened higher and went higher. As of 20:00, the Dow Jones Industrial Average rose by 0.7%, the Nasdaq rose by 1.6%, and the S&P 500 rose by 1.1%.

US technology stocks rose across the board, Apple rose by more than 3%, Nvidia rose by more than 2%, Google, Microsoft and Tesla all rose by more than 1%, ASML US stocks rose by more than 3%, TSMC US stocks rose by more than 5%, and Oracle soared by more than 8%.

But Powell's speech in the evening brought about a full-line collapse.

The Federal Reserve has maintained the benchmark interest rate in the 5.25%-5.5% range for the seventh consecutive time. The latest dot plot suggests that there will be only one interest rate cut this year and four interest rate cuts next year. Officials' expectations for interest rate cuts have changed dramatically. No official believes that there will be three or more interest rate cuts this year, which was previously 10.

But strangely, the Fed still fine-tuned the wording in its policy statement, saying that the committee's 2% inflation target has made small further progress in recent months.

At the press conference, Powell said that the US economy has made significant progress, inflation has slowed significantly, but it is still too high, and the job market has basically returned to pre-epidemic levels.

He pointed out that inflation rose at the beginning of the year and slowed in recent months, but there is uncertainty in the economic outlook and he is still highly concerned about inflation risks. More importantly, he said that the data so far this year has not given the Fed greater confidence that inflation can be sustainably reduced to the target. Although moderate progress has been made, more good data is needed.

After the weak CPI ignited expectations of a rate cut in September, Powell was quite restrained tonight and tried hard to dispel the market's premature optimism.

He hinted several times that there are two conditions for a rate cut, one is that they have greater confidence that inflation can be sustainably reduced to the 2% target, and the other is that the job market slows down unexpectedly. But Friday's non-farm report has confirmed that the job market is unusually strong, and the remaining inflation index seems to be in line with expectations!

Rate cuts will still come, just not so fast! Therefore, the correction trend will continue, but the current game between bulls and bears is too intense.