News

Trump's Diplomatic Push and NAHB's Rate Cut Plea Mute SPY, QQQ Performance

by Crypto Hobby

Updated August 27, 2025

Wall Street bulls and bears in a standoff.

The stock market experienced a muted performance as major indices like the S&P 500 ETF (SPY) and Nasdaq 100 ETF (QQQ) closed slightly lower.

This comes as President Trump engaged in discussions with Ukrainian President Volodymyr Zelenskyy, proposing a trilateral meeting with Russia. Meanwhile, the National Association of Home Builders (NAHB) is urging the Federal Reserve to lower interest rates due to a cooling housing market.

Key Takeaways

President Trump proposed a trilateral meeting with Russia and Ukraine.
The NAHB is advocating for the Federal Reserve to cut interest rates.
Wells Fargo raised its year-end S&P 500 price target.

Diplomatic Developments and Market Reaction

Following a meeting, President Trump announced his intention to contact Russian President Putin to arrange a trilateral meeting aimed at de-escalating the conflict in Ukraine. Trump expressed optimism about reaching an agreement, though his suggestion that Ukraine might cede land to Russia could face opposition from Ukrainian President Zelenskyy, whose country's constitution prohibits such concessions. A closed-door meeting involving Trump, Zelenskyy, and European leaders, including Ursula von der Leyen and Emmanuel Macron, is currently underway.

Intel and Government Investment

The Trump administration is reportedly considering a significant investment in Intel (INTC), potentially acquiring a 10% stake valued at $10.5 billion. This move aligns with the government's allocation of $10.9 billion through the Chips Act, which could be utilized for this stake purchase, possibly making the government Intel's largest shareholder. Intel has already received $2.2 billion from the act and is eligible for further funds upon meeting project milestones.

Housing Market Concerns and Fed Policy

The National Association of Home Builders (NAHB) has joined calls for the Federal Reserve to reduce interest rates. The NAHB/Wells Fargo Housing Market Index (HMI), a measure of homebuilder sentiment, recently dropped to 32, its lowest point since December 2022. NAHB Chief Economist Robert Dietz stated that a slowing housing market and other economic indicators warrant a return to interest rate reductions by the Fed to lower financing costs for construction and indirectly impact mortgage rates.

Wall Street Bullishness and Economic Outlook

Wells Fargo has adopted a more optimistic stance on the stock market, elevating its year-end S&P 500 (SPX) price target to a range of 6,300 to 6,500, an increase from its previous forecast of 5,900 to 6,100. The bank cited factors such as the delayed implementation of tariffs, tax cuts from the "One Big Beautiful Bill," and reduced regulatory risks as drivers for its revised outlook. The S&P 500 closed with a minor loss of 0.01%, while the Nasdaq 100 saw a slight gain of less than 0.01%.