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Update: Wall Street Bounces From 3-Day Sell-Off as Yields Retreat After Fed Rate Hike

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Update: Wall Street Bounces From 3-Day Sell-Off as Yields Retreat After Fed Rate Hike

(Updates with market moves at the end of the day, and other changes, if any.)

US stocks rebounded Thursday after a three-day slump and bond yields fell as traders continued to digest the Federal Reserve's latest policy decision.

The technology-heavy Nasdaq Composite jumped 1.7% to 26,418.30, while the S&P 500 rose 1.1% to 7,637.76. The Dow Jones Industrial Average gained 0.6% to close at 51,778.04. Except financials and consumer staples, all sectors ended in the green, led by tech's 2.2% advance.

Treasury yields were lower, with the 10-year yield down seven basis points at 4.93% and the two-year yield falling 5.4 basis points to 4.67%.

On Wednesday, the Fed raised its benchmark lending rate by 25 basis points in a unanimous vote to combat sticky inflation, while signaling another hike could happen later this year.

"After more than five years of significantly elevated inflation, a period which included a rate cutting cycle, the new Warsh Fed appears to be taking a step in the right direction to combat dangerously high price pressures," Stifel Chief Economist Lindsey Piegza said in a report e-mailed to. "The (Federal Open Market Committee) appears sincere in its commitment to restore price stability."

Policy tightening is likely to continue with an aggregate 50 basis points of additional hikes within the next six months or so, Deutsche Bank and Macquarie Group said, pointing to what they saw as a hawkish "dot plot."

In a social media post Wednesday, President Donald Trump said interest rates in the US "should be 1%, or less."

In other economic news, US housing starts declined to a three-month low in August amid a sharp drop in multi-family projects as homebuilders grappled with higher financing and material costs.

West Texas Intermediate crude oil dropped 1.2% to $101.19 a barrel in Thursday late-afternoon trade, while Brent shed 1.7% to $104.

Generac (GNRC) shares surged 18%, the best performer on the S&P 500. The company said Wednesday it has signed a long-term supply agreement with Amazon (AMZN). Amazon shares rose 2.1%.

Spot gold advanced 1.9% to $4,346.41 per troy ounce, while silver climbed 1.4% to $65.82 per ounce.

What else is happening in US Markets?

New Zealand Economy Shows Resilience Amid Middle East Conflict
US Markets

New Zealand Economy Shows Resilience Amid Middle East Conflict

The New Zealand economy showed expansion in the June quarter despite the Middle East conflict and continued pressure on global oil prices.New Zealand's economy expanded 0.2% in the June quarter, following a 0.9% expansion in the previous quarter, with the GDP per capita rising 0.1%.Nine out of 16 industries recorded higher economic activity in the June quarter, with construction leading gross domestic product growth at 2.7% while transport, postal, and warehousing were the largest negative contributors, declining 1.7%.The expenditure measure of GDP rose 0.4% in the June quarter, following a 1.1% increase in the previous quarter, as export volumes rose 3.3% while import volumes fell 0.8%.Westpac, which also expected 0.2% quarterly growth, said the data was a little softer in the details than expected, as the non-additive balancing item and agriculture, transport and administrative services showed lower growth than anticipated.ANZ, which expected a 0.1% quarterly rise, said that data suggests that the economy has grown at a "reasonable pace" in the months following June, but recovery will likely be "patchy" due to ongoing offshore volatility.The financial services firm expects the Reserve Bank of New Zealand to hike interest rates by 25 basis points in October as it believes that global developments since the September meeting suggest that a sooner hike would be more prudent.

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Update: Wall Street Extends Losses Following Fed Hike
US Markets

Update: Wall Street Extends Losses Following Fed Hike

(Updates with market moves at the end of the day, and other changes, if any.)US stocks fell for a third straight session on Wednesday after the Federal Reserve delivered its first interest rate increase since 2023 and signaled another hike later this year amid elevated inflation.The Dow Jones Industrial Average shed 1.2% to close at 51,461.90, while the S&P 500 dipped 0.5% to 7,551.81. The Nasdaq Composite settled just below the flatline at 25,978.42. Most sectors ended in the red, led by energy.In a unanimous vote, the central bank's Federal Open Market Committee lifted the federal funds rate to a range of 3.75% to 4%. The Fed's latest Summary of Economic Projections document showed the median policy rate at 4.1% at the end of 2026, up from 3.8% projected in June."Inflation remains elevated," the FOMC said in a statement. "Today's policy action will support a timelier return to the committee's 2% (inflation) goal."Policymakers raised their 2026 projections for personal consumption expenditure headline and core inflation, but left forecasts for 2027 unchanged."The plain fact is that inflation is too high and has been for too long," Fed Chair Kevin Warsh said in a press conference. "This summer's inflation readings do not tell me that underlying trends have meaningfully improved."The Fed now sounds "more hawkish" than it did in June, according to ING Bank."Our growth, inflation and jobs forecasts suggest little need for further rate hikes, and it may well be that the Fed is striking a hawkish line in order to build more credibility with bond markets as they look to support Treasury efforts to anchor the long end of the curve," ING said in a report.Treasury yields were higher following the Fed announcement, with the two-year rate up six basis points at 4.73% and the 10-year rate rising 1.4 basis points to 5.01%.In other economic news, US retail sales rebounded more than expected in August as higher fuel prices lifted spending at gasoline stations and outlays on motor vehicles turned positive.US homebuilder confidence this month hit its lowest level since September 2025 amid elevated mortgage rates and material costs, the National Association of Home Builders and Wells Fargo said.West Texas Intermediate crude oil was down 3.6% at $101.99 a barrel in Wednesday late-afternoon trade, while Brent dropped 3.1% to $105.39.Saudi Arabia is working to return about half the capacity of its East-West oil pipeline within days, Bloomberg News reported. Drone attacks led to the shutdown of that pipeline last week.Shares of Intel (INTC) rose 4% following a Reuters report that the chipmaker and SK Hynix (SKHY) were discussing a US memory chip partnership."SK Hynix is exploring various options to strengthen its global competitiveness, but no specific plans or arrangements have been finalized at this time," the company said in a statement. SK Hynix's US-listed shares were little changed.J.B. Hunt Transport Services (JBHT) tumbled 13%, the worst performer on the S&P 500, after Chief Financial Officer Brad Delco said during a conference call Tuesday that the company expects its third-quarter profit to decline sequentially.Spot gold edged down 0.5% to $4,271.55 per troy ounce, while silver lost 1.4% to $66.75 per ounce.

Dow JonesNasdaq CompositeS&P 500$INTC$JBHT$SKHY
Union Pacific Set to Benefit From Continued Volume Gains in 2027, UBS Says
US Markets

Union Pacific Set to Benefit From Continued Volume Gains in 2027, UBS Says

Union Pacific (UNP) is set to benefit from continued volume gains in 2027, along with pricing tailwinds, UBS Securities said Wednesday.The brokerage expects the railroad operator's total volume to grow 3.5% next year following an estimated 3.9% increase in 2026.The intermodal business volume is seen rising 6% to 7% in 2027, along with gains within the industrial segment, UBS analysts, including Thomas Wadewitz, said."Our analysis of key customer markets points to a second year of strong volume growth in 2027 and our analysis of intermodal and merchandise pricing versus the truckload market points to a stronger tailwind from price," Wadewitz wrote.The investment firm upgraded its rating on Union Pacific's stock to buy from neutral and raised the price target to $339 from $310.UBS increased its earnings per share estimates to $13.41 from $13.33 for 2026 and to $14.90 from $14.75 for 2027. Wall Street expects $13.06 and $14.15, respectively, according to the brokerage."The time lag of rail pricing to truck points to stronger pricing for (Union Pacific) and a price/mix (versus) inflation impact which is neutral rather than a headwind," Wadewitz said.A merger with Norfolk Southern (NSC) should drive upside for Union Pacific over the next 12 months, Wadewitz wrote. In 2025, Union Pacific agreed to acquire Norfolk in a cash-and-stock deal valuing the smaller railroad operator at about $85 billion.While the regulatory approval path remains unpredictable, a successful combination could result in pro-forma EPS in a range of $19.40 to $21.90 in 2030, UBS said.Union Pacific's shares closed 1.1% down on Wednesday, while Norfolk Southern's stock fell 1%.Norfolk Southern and Union Pacific reported stronger-than-expected second-quarter results in July amid robust freight demand and higher fuel surcharges.In July, US railroad operator CSX (CSX) posted a second-quarter beat on profit and revenue as volume increased, driven by intermodal growth.Price: $281.03, Change: $-2.96, Percent Change: -1.04%

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