U.S. equity markets drifted into the red Friday, capping a muted session as investors digested dovish signals from the Federal Reserve and a bold regulatory pivot by the Trump administration toward digital assets.

The Dow Jones Industrial Average shed 142.64 points, or 0.32%, to close at 34,341.90. The S&P 500 dipped 0.60 points, or 0.01%, ending the day at 6,296.76. The Nasdaq Composite eked out a modest gain, rising 11.39 points, or 0.05%, to 20,895.70.

Investor sentiment was tempered by cautious positioning ahead of the Federal Reserve’s July 29-30 policy meeting. Fed Governor Christopher Waller stoked debate with remarks favoring an earlier rate cut, citing weakening private-sector job growth as a justification for preemptive easing.

“Private-sector conditions may not be as robust as widely believed,” Waller said Friday, pointing to June employment data that showed a slowdown in private hiring and more moderate wage increases. He hinted he might dissent from the committee if it opts to delay a rate move, adding urgency to his argument for July action.

The market reacted swiftly. The U.S. dollar index fell 0.39% following Waller’s comments, while Treasury yields edged lower—signaling investor expectations for a potentially sooner-than-expected shift in monetary policy.

Meanwhile, President Donald Trump signed the “Genius Act,” a sweeping stablecoin regulatory bill aimed at cementing U.S. dominance in global crypto markets. The legislation outlines new frameworks for stablecoin issuance, reserve requirements, and consumer protections—positioning the dollar to maintain primacy in a rapidly digitizing financial system.

The Genius Act represents a significant step with ambitions to transform the U.S. from a reactive to a proactive force in crypto regulation. The move was viewed as a potential boon for financial technology and crypto-linked equities, although broader market reaction remained subdued.

Elsewhere in commodities, crude oil for August delivery settled at $67.43 a barrel, down 0.16%, amid choppy trading throughout the session. Gold ticked up 0.28% to $3,354.60 as investors sought refuge in the metal following the Fed’s mixed policy cues.

The Russell 2000 index of small-cap stocks underperformed, falling 1.61 points, or 0.72%, to 2,223.10, reflecting ongoing uncertainty among domestically focused firms sensitive to rate and policy shifts.