Daily Market Update: Bitcoin Surges 8% as Wall Street Giants Open Door to Crypto Investments

TLDR

• Stock futures rose around 0.2% Tuesday evening with Dow, S&P 500, and Nasdaq 100 all posting gains ahead of key jobs data
• Bitcoin climbed back above $91,000, up 8% in 24 hours, while ethereum reclaimed $3,000 after a 10% jump on Tuesday
• Vanguard lifted its ban on crypto ETFs and Bank of America now allows advisers to recommend 1-4% crypto allocations to clients
• CME FedWatch shows 87.2% chance of a 25-basis point Fed rate cut at the Dec. 10 meeting, up from 63% a month ago
• Total crypto market capitalization rose to $3.06 trillion after falling below that level during Sunday’s sell-off

The stock market showed modest gains Tuesday evening while crypto markets staged a rebound following policy changes from major financial institutions and rising expectations for a Federal Reserve rate cut.

Stock futures edged higher across major indexes. Dow Jones Industrial Average futures, S&P 500 futures, and Nasdaq 100 futures all posted gains of around 0.2% as traders looked ahead to Wednesday’s ADP private payrolls report due at 8:15 a.m. ET.

The broader stock market finished Tuesday higher across the board. Tech stocks including Nvidia helped lift indexes while investors prepared for the Fed’s Dec. 10 policy decision.

Markets are currently pricing in roughly an 89% probability of a rate cut according to the CME FedWatch tool. With government data still delayed after the shutdown and no nonfarm payrolls report this week, the ADP report will serve as one of the last major labor market indicators ahead of the central bank’s decision.

Bitcoin climbed back above $91,000 on Tuesday, gaining approximately 8% over 24 hours. Ethereum reclaimed the $3,000 level after a 10% jump.

Total crypto market capitalization rose to $3.06 trillion. This marked a recovery after the market slipped below $3 trillion during Sunday night’s sell-off.

Major Policy Shifts

Vanguard lifted its long-standing ban on bitcoin ETF purchases. The change took effect for the Tuesday trading session.

BlackRock’s IBIT saw $1 billion in volume within the first 30 minutes of trading. Bank of America told advisers across Merrill, Private Bank and Merrill Edge that clients can now allocate 1-4% of portfolios to crypto.

The policy change affects more than 15,000 advisers who previously faced restrictions on recommending digital-asset products. This marks an end to a long-standing limitation at one of the largest U.S. brokerages.

Fed Rate Cut Expectations Rise

Traders increased their bets on lower interest rates heading into December. CME FedWatch now shows an 87.2% chance of a 25-basis point cut at the Dec. 10 meeting, up from 63% a month ago.

Only 12.8% of traders expect the Fed to hold the current 375-400 basis points target range. The shift has supported a broader bid across risk assets that rely on looser liquidity conditions.

Cardano gained about 14.5% while Solana added 11%. Chainlink climbed more than 12%, helped by the launch of Grayscale’s new Chainlink ETF on NYSE Arca.

The new ETF gives U.S. investors their first spot product tied to LINK. Marvell Technology surged 10% in after-hours trading after delivering stronger-than-expected fiscal third quarter results.

American Eagle Outfitters jumped more than 10% after raising its full-year outlook. The retailer cited a stronger-than-anticipated start to the holiday shopping season.

SEC Chairman Paul Atkins told CNBC the agency is preparing an “innovation exemption” and expects to move forward on long-delayed crypto rulemaking “in a month or so.”

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