Briefing.com Summary:
*New York Fed President Williams sees room for rate cut in December; Boston Fed President Collins not so much.
*The pre-market trading tone is positive, but can it last?
NVIDIA (NVDA) did everything right with its earnings results and guidance. For a time yesterday, its stock did everything right, too, gaining as much as 5.1%. Then, everything went wrong. NVIDIA gave up the entirety of that gain and ultimately closed with a 3.2% loss.
It was a disappointing reversal, to say the least. It was a reversal that took the market down with it, not because of fundamental concerns about NVIDIA’s operating performance, but because of psychological concerns over the price action.
The inference was that general valuation angst surrounding the AI trade and the broader market, which has been steered by the mega-cap stocks and the AI trade, had not been put to rest by NVIDIA’s own outstanding results, which ironically did nothing to allay concerns about overinvestment by other companies needing NVIDIA’s GPUs.
The reversal was exacerbated by technical resistance at the 50-day moving averages for the S&P 500 and Nasdaq Composite, and fading rate-cut expectations for the December FOMC meeting.
Earlier this morning, the equity futures market looked lethargic and not ready to exude any buy-the-dip swagger despite better-than-expected earnings results from Gap (GAP), Ross Stores (ROST), and Intuit (INTU).
That all changed, however, after New York Fed President Williams (FOMC voter) said in a speech that he sees room for a near-term adjustment to the target range for the fed funds rate (translation: he will be lobbying to cut rates in December).
Shortly before that remark, the probability of a 25-basis-point cut to 3.50-3.75% in December stood at just 37.6%, according to the CME FedWatch Tool. It is now 70.9%.
The S&P 500 futures are up 35 points and are trading 0.5% above fair value, the Nasdaq 100 futures are up 115 points and are trading 0.4% above fair value, and the Dow Jones Industrial Average futures are up 261 points and are trading 0.6% above fair value.
It has been an interesting response, knowing that Boston Fed President Collins (also an FOMC voter) told CNBC that she thinks a mildly restrictive policy stance is appropriate right now (translation: she will not be lobbying for a rate cut in December).
There has been a shift in the trading tone, then, just like there was yesterday. The shift today, though, is positive as opposed to negative. Spirits have been lifted because of it, but the risk is that the positive tone isn’t sustained, just like yesterday. If that ends up being the case, then today could end up looking a lot like yesterday, if not worse.
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Originally Posted on November 21, 2025 – A shift in trading tone as Williams ignites shift in rate-cut expectations
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