Wall Street ends sharply higher as Waller remarks ease rate hike fears

On Thursday, Wall Street experienced a sharp upward trend, with all three major US stock indexes closing more than 1% higher. The Nasdaq index saw substantial gains due to the strong performance of the "Magnificent Seven" group of AI-related megacap stocks. This surge in stock prices came after US Federal Reserve Governor Christopher Waller indicated his support for maintaining the Fed funds target rate steady if upcoming data suggests inflationary pressures are subsiding.

Waller's remarks eased concerns about potential rate hikes at the Federal Reserve's September meeting, reducing the probability of a hike to 50.4% from 63.2% the previous day, according to CME's FedWatch tool. The benchmark US Treasury yield experienced a decline for the second consecutive session, as rate-hike expectations softened following a global bond selloff driven by inflation fears, ballooning debt, and geopolitical uncertainty.

Market analysts attributed the broad market lift to Waller's comments, while individual stocks like Nvidia and Snowflake demonstrated notable gains, while others such as Broadcom faced declines due to weaker-than-expected financial results.