Equity markets rallied in August as investors grew enthusiastic over the potential for the Federal Reserve to cut rates at the upcoming September FOMC meeting. CME FedWatch data suggests that the probability of a rate cut at the Fed’s next meeting in mid-September is now over 90%, and investors appear to be leaning into the bullish market backdrop. Although equity markets remain concentrated in the Magnificent 7, performance broadened somewhat in August with the tech sector taking a breather and market leadership rotating to prior laggards. With the VIX Index or market fear gauge dropping to historically benign levels, equity markets ended the month near all-time record highs.