DistantNews
Support us
🇬🇷 Greece /Economy & Trade

Wall Street rises more than 1% after Fed official’s comments on interest rates

From Ta Nea · () Greek

Translated from Greek and summarized by DistantNews. Read the original for the full story.

At a glance

Newswire Named sources Ongoing story
  • The Dow Jones, S&P 500 and Nasdaq each rose more than 1% as investors reduced expectations of another Federal Reserve rate increase.
  • Fed Governor Christopher Waller said he would support keeping rates unchanged if upcoming data showed inflation pressures were easing, but would back an increase if inflation persisted.
  • Markets turned their attention to the U.S. employment report, expected to show 56,000 new jobs and a 4.1% unemployment rate.

Wall Street posted gains of more than 1% across its three main indexes after Federal Reserve Governor Christopher Waller gave investors room to reconsider their expectations for another rate increase.

Waller told Reuters he would support leaving benchmark interest rates unchanged if upcoming economic data confirmed that inflation pressures were easing. He also said he would support a rate increase if inflation failed to slow. Markets responded by lowering the implied probability of a September rate hike to 50.4%, from 63.2% on Wednesday, according to CME’s FedWatch tool.

The Nasdaq benefited from gains in large technology companies known as the Magnificent Seven. All three indexes were on track for weekly gains. The benchmark U.S. Treasury yield fell for a second straight session after recently reaching its highest level since November 2023.

Expectations of higher interest rates had strengthened in previous sessions as long-term government bond yields climbed to multiyear highs during a global bond-market sell-off. The pressure reflected concerns about inflation, rising public debt and geopolitical uncertainty.

“Waller’s comments provide broad support for markets,” said Bill Northey, senior investment director at U.S. Bank Wealth Management in Billings, Montana. Northey said the market was also being shaped by companies that reported second-quarter results late, with especially sharp differences among semiconductor and software stocks.

Thursday’s economic data was mostly positive. New applications for unemployment benefits remained low, and the services sector accelerated. Input prices in services, however, rose to their highest level since October 2022, while the international trade deficit widened by 24.4%.

Investors were awaiting the Labor Department’s August employment report, due Friday. Economists expected 56,000 jobs to be added, with unemployment holding at 4.1%.

Waller’s comments provide broad support for markets.

· Bill NortheyThe U.S. Bank Wealth Management investment director assessed the market reaction to Waller’s comments.
About this summary

Originally published by Ta Nea in Greek. Translated, summarized, and contextualized automatically by DistantNews, with a note on how the source frames the story. Not individually reviewed before publishing. How this works.

More Stories

From Our Blog