Markets trade mixed as stocks, dollar, Bitcoin, and gold react to rate cut

Traders across the world hit pause Thursday night after a wild rally earlier in the day sent stocks and metals flying.

Everyone from New York to Tokyo is now eyeing next week’s rate decision, betting the Federal Reserve is finally ready to cut interest rates.

That expectation is what drove Thursday’s gains; soft jobs data and cooling inflation gave Wall Street the green light to price in a shift from Jerome Powell’s team.

Futures tied to the Dow Jones Industrial Average, the S&P 500, and the Nasdaq 100 barely moved in overnight trading.

That calm followed a blowout session where the Dow soared more than 600 points, closing above 46,000 for the first time in history. The S&P 500 added 0.9%, and the Nasdaq Composite finished 0.7% higher. All three closed at record highs, according to data from CNBC.

Asian and European traders track U.S. momentum

Early Friday numbers in Europe showed a muted but positive mood. Futures linked to the Stoxx 50, FTSE 100, DAX, and CAC 40 all moved about 0.3% higher.

But investors in the U.K. got slapped with a zero-growth print for July, following 0.4% growth in June. That stagnation puts more pressure on the Bank of England just days ahead of its own monetary policy meeting.

The European Central Bank didn’t change its benchmark rate Thursday, which matched market expectations and kept borrowing costs steady across the eurozone, as Cryptopolitan reported.

In Asia, things leaned bullish. Hong Kong’s Hang Seng jumped 1.64%, while mainland China’s CSI 300 edged up 0.19%. Two Chinese tech giants made headlines.

Shares of Alibaba and Baidu, both listed in Hong Kong, rallied more than 6% and 10%, after a report from The Information said both companies have started training AI models on their own chips.

Alibaba’s chips have been running smaller models since early this year, and Baidu is using its new Kunlun P800 to power the next version of its Ernie model. Both are slowly cutting out Nvidia.

The momentum stretched across the region. Japan’s Nikkei 225 went up 0.58%, setting a new all-time high. The Topix rose 0.61%, South Korea’s Kospi climbed 0.83%, and the Kosdaq added 0.65%. India’s Nifty 50 crept up 0.17%, and Australia’s S&P/ASX 200 ticked higher by 0.41%.

Bitcoin struggles, gold climbs, dollar slides

Bitcoin stayed stuck between $110,000 and $116,000 as of Friday morning. The recovery from a dip to $107,000 brought in some buyers, but momentum got choked by short-term holders cashing out and others realizing losses.

The crypto needs to stay above $114,000 to rebuild confidence. If not, it risks falling back toward $93,000, which is the next major cluster of support.

ETF flows slowed to about ±500 BTC per day, a big drop from the peaks in March and December 2024 when traditional finance demand pumped Bitcoin higher. With that drying up, derivatives are now doing most of the work.

Futures volume is steady, and options open interest is rising; signs of a more risk-controlled market. On-chain liquidity, though, is fading.

Gold had no such problem. Spot prices were up 0.5%, trading at $3,651.92 an ounce just after 0600 GMT. That’s within striking distance of Tuesday’s record high of $3,673.95. U.S. futures for December climbed to $3,690.30.

Bullion is now up 1.8% this week and has surged nearly 39% this year. The run has been helped by a soft dollar, global uncertainty, and strong central bank demand.

Other metals followed. Silver added 1.2% to $42.07, platinum rose 1.1% to $1,393.71, and palladium climbed 1% to $1,200.31. All three are heading for weekly gains.

The U.S. dollar slipped again. The dollar index dropped 0.3% to 97.51. The greenback lost ground against several currencies: down 0.3% versus the yen to 147.09, 0.5% against the Swiss franc to 0.7956, and 0.4% lower versus the pound, now at $1.3578.

The euro rose 0.4% to $1.1738, held flat against the pound, and gained 0.2% against the yen to 172.78.

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