WASHINGTON — U.S. stocks rallied across the board after a Federal Reserve official signaled conditional support for keeping interest rates unchanged.
On the 3rd, the Dow Jones Industrial Average closed at 53,686.11, up 624.16 points, or 1.18%, on the New York Stock Exchange. The Standard & Poor's 500 rose 81.11 points, or 1.06%, to 7,747.71, and the Nasdaq gained 366.23 points, or 1.40%, to 26,584.06.
Sentiment improved after Fed Governor Christopher Waller said at a Reuters event that he would be willing to support holding rates at the current level if there is continued progress toward the 2% inflation target. Waller also said he would support a rate increase if inflation surges, but markets focused on his comments about holding rates steady.
According to the CME FedWatch tool, the probability of a 0.25 percentage point increase in the benchmark rate in September fell to 50.5% from 63.2% a day earlier in the federal funds futures market. The two-year Treasury yield, which is sensitive to the policy rate, fell to 4.322%, while the 10-year yield, which had recently topped 4.8%, ended at 4.761%. Treasury yields declined for a second straight day. The yen strengthened to the 155 range against the dollar as expectations grew for a Bank of Japan rate increase and as caution mounted over possible intervention by authorities.
Still, few see the turmoil in developed-market government bond yields as fully over. Sam Stovall of CFRA Research told CNBC that if oil prices stubbornly remain at high levels, high interest rates could remain a hurdle for investors to overcome. On the New York Mercantile Exchange, West Texas Intermediate crude futures for October delivery settled 0.32% higher at $91.30 a barrel, while Brent crude futures for November delivery on the ICE Futures Europe exchange in London fell 0.12% to $95.52.
The Philadelphia Semiconductor Index rose 0.11% and Micron gained 0.22%, while SK hynix's American depositary receipts fell 0.79%. Software company Snowflake surged 17% on strong earnings. Consumer-related shares climbed 1.6%, leading the day's overall gains. Lululemon plunged 19% in after-hours trading after reporting a 4% decline in second-quarter revenue and forecasting third-quarter revenue of $2.29 billion to $2.32 billion, down 10% to 11% from a year earlier.
As Treasury yields calmed, bitcoin was trading at $81,547 as of 4:30 p.m. Eastern time, topping the $80,000 mark.
