Friday 4th September 20226
🌍The market Story
US stocks rallied Thursday, with the S&P 500 up 1.06% after Fed Governor Christopher Waller pushed back against the idea that a September rate hike is inevitable.
The move was broad, with software, consumer stocks and crypto-linked names all gaining as Treasury yields fell and rate-hike odds dropped toward 50%.
But oil remains the main problem. Brent is now above $96, keeping inflation pressure alive even as the labor market cools.
Today’s jobs report is the key test, but next week’s inflation data may matter even more.
📊 Market Snapshot
US Markets:
Index | Close | Daily Move |
|---|---|---|
S&P 500 | 7,747.71 | +1.06% |
Nasdaq | 26,584.06 | +1.40% |
Dow Jones | 53,686.11 | +1.18% |
Russell 2000 | 2,968.27 | +0.51% |
Market Takeaway: Stocks rallied broadly as lower bond yields and reduced expectations for a September rate hike brought buyers back into the market.
Key Markets:
Gold: $4,477 per ounce
Gold is holding onto Thursday’s rally after lower yields and a weaker dollar made it more attractive.
Oil: $96.06 per barrel
Oil remains elevated after a strong weekly surge, keeping inflation pressure firmly in focus.
Bitcoin: $80,900
Bitcoin has rallied sharply alongside other risk assets after Waller’s comments cooled rate-hike fears.
Dollar: The dollar has weakened as Fed hike expectations eased.
🔎 Why Markets Moved
1. Fed hike fears eased
Fed Governor Christopher Waller said a September rate hike is not inevitable, which pushed hike odds down toward 50%.
Why markets cared:
That helped Treasury yields fall and reduced pressure on stock valuations.
2. Buyers returned across the market
The rally was broad, with software, consumer stocks, crypto-linked names and small caps all moving higher.
Why markets cared:
It showed the rebound was not just being driven by a few mega-cap stocks.
3. AI and software optimism stayed strong
Snowflake surged on a stronger outlook, while Nvidia and other tech names also gained.
Why markets cared:
It reinforced confidence that AI spending and software demand remain strong despite the tougher macro backdrop.
Biggest Winners 📈 & Biggest Losers 📉
Winners -
📈 Strategy: +17.6%
Strategy surged as Bitcoin climbed back toward $81,000.
Why it moved:
Its large Bitcoin holdings make the stock highly sensitive to moves in crypto.
📈Snowflake: +16.6%
Snowflake jumped after raising its revenue outlook on stronger cloud and AI demand.
Why it moved:
Investors saw further evidence that companies are beginning to spend more on AI-powered software, not just chips.
📈 Robinhood: +16.6%
Robinhood rallied alongside crypto and other higher-risk assets.
Why it moved:
Lower rate-hike expectations improved risk appetite and supported trading-related stocks.
Losers -
📉 Broadcom: −2.7%
Broadcom fell despite strong AI growth after its near-term revenue outlook disappointed very high expectations.
Why it moved:
The results were strong, but investors expected even more from one of the market’s biggest AI beneficiaries.
📉AMD: −2%
AMD slipped despite the broader technology rally.
Why it moved:
Broadcom’s results raised some concerns around margins and competition in custom AI chips.
The takeaway:
Crypto and AI software produced some of Thursday’s biggest gains, while a select few semiconductor names struggled because expectations remain extremely high.
⚠️ Key Risks
1. Payrolls revive September hike fears
A strong jobs or wage number could push Fed hike odds back above 50%.
Why it matters:
That would likely send Treasury yields higher again and put pressure on growth stocks.
2. Oil pushes toward $100
Brent is already around $96 after a sharp weekly rise.
Why it matters:
Higher oil would keep inflation pressure elevated and make it harder for the Fed to stay on hold.
3. Services inflation stays sticky
Recent services-price data remains uncomfortable.
Why it matters:
Even if hiring slows, persistent inflation could still keep another rate hike on the table.
👀 What To Watch Today
👀 What To Watch Today
1. August jobs report
The official US jobs report is due at 8:30 a.m. ET / 1:30 p.m. UK time.
What’s expected:
Nonfarm payrolls: +56,000
Unemployment rate: 4.1%
Wage growth: 3.0% year on year
Why it matters:
A stronger-than-expected report could push September Fed hike odds higher again and lift Treasury yields. A softer number could support stocks, provided it does not look weak enough to raise recession concerns.
In other words good news = bad news and vice versa unless that bad news is really bad.
2. Market breadth
Thursday’s rally was broad, with advancing stocks comfortably outnumbering decliners.
Why it matters:
If breadth stays strong today, it would make the rebound look more convincing. If the indices rise but fewer stocks participate, that would be a weaker signal.
3. Oil and Treasury yields
Brent is around $96, while the 10-year Treasury yield is near 4.76%.
Increases here will put pressure on stocks so watch these numbers as always.
Bottom Line
Thursday’s rally was a strong improvement, with lower yields, broader buying and reduced Fed hike expectations helping stocks recover.
But oil near $96 and today’s jobs report keep the macro risk high.
The best outcome now is a jobs number soft enough to keep the Fed cautious, but strong enough to avoid concerns about the broader economy.