Fed's Waller Calms Markets as Stocks Rally Toward Records

The Dow Jones Industrial Average surged 624.16 points, or 1.18%, to settle at 53686.11. The S&P 500 added 81.11 points to reach 7747.71, while the tech-heavy Nasdaq Composite climbed 1.4% to finish at 26584.06. Market sentiment shifted as traders responded to Waller’s explicit call to give current disinflationary trends more room to develop before adjusting monetary policy.

This shift in expectations cooled the Treasury market, where yields retreated across the board. The yield on the policy-sensitive two-year note fell 0.051 percentage point to 4.332%, while the 10-year note slipped 0.032 percentage point to 4.761%. Waller indicated he would closely monitor August price data for further evidence of cooling inflation before solidifying his stance on future rate adjustments.