Market Summary
U.S. equities extended their rebound on Thursday, September 3, as easing Treasury yields provided a friendlier backdrop following the sharp volatility earlier in the week. The S&P 500 climbed 81.11 points (+1.06%) to close at 7,747.71, the Nasdaq Composite jumped 366.23 points (+1.40%) to 26,605.11, and the Dow Jones Industrial Average surged 624.16 points (+1.18%) to 53,686.11. The Russell 2000 (+0.5%) and S&P Mid Cap 400 (+0.9%) posted more modest gains, reflecting continued large-cap leadership.
The rally was fueled by falling Treasury yields after Fed Governor Christopher Waller (a voting FOMC member) signaled he would support holding rates steady in September absent negative data surprises, citing encouraging signs of disinflation even as inflation remains above the Fed’s 2.00% target. The CME FedWatch Tool raised the probability of a September hold to 49.6% from 36.8% a day earlier. Mega-cap growth stocks led the charge — the Vanguard Mega Cap Growth ETF rose 1.6% — powering gains in consumer discretionary, communication services, financials, and information technology. Software staged a pronounced rebound from Wednesday’s selloff (iShares GS Software ETF +3.4%), while semiconductors lagged for most of the session before paring losses into the close.
Breadth was constructive but not overwhelming: NYSE advancers led decliners 1,634 to 1,072 on 1.11 billion shares traded, while Nasdaq advancers outpaced decliners 2,718 to 1,682 on heavy volume of 7.61 billion shares. Energy and materials were the lone sector laggards as crude firmed modestly and yields declined. Heading into Friday’s closely watched August Employment Situation report, the major averages carry modest week-to-date gains after clawing back from early-week weakness.
Market Snapshot
| Index | Level | Change | % Change |
|—|—|—|—|
| Dow Jones | 53,686.11 | +624.16 | +1.18% |
| Nasdaq Composite | 26,605.11 | +366.23 | +1.40% |
| S&P 500 | 7,747.71 | +81.11 | +1.06% |
Breadth (NYSE): Advancers 1,634 | Decliners 1,072 | Volume 1.11 bln
Breadth (Nasdaq): Advancers 2,718 | Decliners 1,682 | Volume 7.61 bln
WaveFinder Breadth Metrics:
- Primary Sentiment: Very Bullish (Bulls 987 / Bears 702)
- 4% Sentiment: Bullish (Bulls 115 / Bears 48)
- 40 SMA Sentiment: Neutral
- % of Stocks Above 20-day SMA: 11%
- % of Stocks Above 40-day SMA: 44.63%
- 9-Month Bulls: 31 | Bears: 5 (Follow-Through: 30.3%)
YTD Performance: Russell 2000 +19.6% | Nasdaq Composite +14.4% | S&P Mid Cap 400 +14.4% | S&P 500 +13.2% | DJIA +11.7%
Sector Performance
1. Financials — +1.6% (Strong; major banks broadly participated, led by outsized gains in Robinhood and Coinbase)
2. Consumer Discretionary — +1.6% (Strong; Tesla a standout contributor)
3. Communication Services — +1.5% (Strong; Meta Platforms a key driver)
4. Information Technology — +1.3% (Strong; software rebound offset early semiconductor weakness)
5. Real Estate — Strong (per Industry Watch; specific % not disclosed)
6. Utilities — Strong (per Industry Watch; specific % not disclosed)
7. Health Care — Not specifically quantified; not listed among strong or weak sectors
8. Industrials — Not specifically quantified; not listed among strong or weak sectors
9. Consumer Staples — Not specifically quantified; pressured by earnings-related weakness in select names (Tyson Foods, Campbell’s)
10. Materials — -0.5% (Weak)
11. Energy — -0.7% (Weak; widest sector loss of the session despite firmer crude)
Note: Full 11-sector percentage breakdown not disclosed in source data; rankings reflect Briefing.com’s Industry Watch (Strong/Weak groupings) combined with specific percentages cited in the narrative.
Key Earnings & Movers
Gainers:
- Snowflake (SNOW) $356.24, +$50.40 (+16.48%) — Surged on an impressive earnings beat
- Robinhood Markets (HOOD) $124.72, +$17.73 (+16.57%) — Rallied alongside Bitcoin’s move above $80,000
- Coinbase Global (COIN) $192.70, +$17.74 (+10.14%) — Benefited from crypto strength
- Tesla (TSLA) $376.36, +$19.36 (+5.42%) — Led mega-cap growth gains
- Hewlett Packard Enterprise (HPE) $54.44, +$2.61 (+5.03%) — Rose despite a mixed session narrative (broad earnings beat, above-consensus Q4 guidance)
- Dell (DELL) $515.94, +$23.74 (+4.82%) — Extended post-earnings momentum to a new all-time high
- Microsoft (MSFT) $510.12, +$13.30 (+2.68%) — Gained on major reporting-structure overhaul
- Meta Platforms (META) $610.68, +$17.83 (+3.01%) — Notable communication services contributor
Decliners:
- Tyson Foods (TSN) $51.77, -$4.04 (-7.24%) — Lowered FY26 revenue guidance
- The Campbell’s Company (CPB) $22.12, -$1.66 (-6.96%) — Disappointing FY27 outlook
- Broadcom (AVGO) $357.16, -$10.08 (-2.74%) — Better-than-expected Q3 results overshadowed by elevated AI/Q4 expectations
- Ciena (CIEN) — Sharply lower despite a strong Q3 beat and upbeat FY27 framework, continuing a pattern of selling the news
- lululemon — Sharply lower after-hours following another guidance cut
- Guidewire Software — Under pressure in after-hours trading
Stock Spotlight
Microsoft’s Reporting Overhaul. Microsoft (MSFT +3%) was one of the session’s most notable movers after announcing a major restructuring of its segment reporting, consolidating three existing segments into two: Agents and Infra, and Devices and Consumer. The change, effective with the new fiscal year and first appearing in Q1 (September), is designed to better reflect the company’s increasingly AI- and cloud-centric business mix. Agents and Infra — housing Azure, Microsoft 365 cloud, GitHub, server licensing, Dynamics, and LinkedIn — becomes the core of the business, with Q1 revenue guidance of $75.15–75.75 billion. Notably, Microsoft will begin reporting Azure revenue in dollar terms rather than percentage growth alone, with Q1 Azure growth guided at +44–45% constant currency, offering a cleaner comparison to Amazon’s AWS. The much smaller Devices and Consumer segment (Search and Advertising, Xbox, Windows OEM, devices) is guided at $14.7–15.2 billion for Q1.
Microsoft also reaffirmed its company-wide revenue outlook and Q1 capital expenditures of more than $50 billion, underscoring that its aggressive AI infrastructure buildout remains fully intact. Briefing.com’s analysis characterizes the move as a “welcome change” that should sharpen investor visibility into the businesses most levered to AI and cloud spending, while the revised Azure metric provides a more direct read on underlying cloud momentum versus peers.
Bond Market & Treasuries
U.S. Treasuries climbed Thursday but made little intraday progress, finishing near opening levels after a “Short End Leads Thursday Bounce” session. Yields fell across the curve:
- 2-yr: 4.33% (-6 bps)
- 3-yr: 4.41% (-4 bps)
- 5-yr: 4.51% (-4 bps)
- 10-yr: 4.76% (-3 bps)
- 30-yr: 5.24% (-2 bps)
The primary catalyst was Fed Governor Waller’s comments indicating he would support holding rates steady at the September meeting absent negative data surprises, while acknowledging inflation remains meaningfully above target. Treasuries notched highs roughly 30 minutes after the open before drifting back toward starting levels, then made a late-morning run at highs that fell short, resulting in a narrow afternoon range. The Atlanta Fed trimmed its Q3 GDPNow forecast to 4.7% from 4.8% following the data slate, which included a slight uptick in jobless claims, a downward revision to Q2 unit labor costs, and an acceleration in the ISM Services Index. The U.S. Dollar Index fell 0.7% to 98.93 amid a jump in the Japanese yen following Treasury Secretary Bessent’s remarks on Japan’s currency plans, which served as a form of verbal intervention.
Commodities
- WTI Crude Oil: Settled at $91.35/barrel, +$0.39 (+0.4%)
- Premarket levels: WTI $92.07/bbl (+1.2%); Brent crude $96.30/bbl (+0.7%)
- Gold, Silver, Copper: Not disclosed in available data
Overseas Markets
Asia-Pacific:
- China’s August RatingDog Services PMI: 51.4 (vs. 50.6 expected; prior 50.4)
- Japan’s August Services PMI: 52.5 (vs. 52.3 expected; prior 51.2)
- Hong Kong’s August Manufacturing PMI: 49.5 (prior 51.0)
- Australia’s August Services PMI: 53.2 (vs. 52.9 expected; prior 53.6)
- Australia’s July trade surplus: AUD 1.923 bln (vs. AUD 1.400 bln expected; prior AUD 2.341 bln), with imports -2.5% m/m and exports -3.3% m/m
- New Zealand’s Q2 Terms of Trade Index: -9.0% qtr/qtr (vs. -2.1% expected; prior -1.9%)
- India’s August Services PMI: 54.1 (vs. 54.5 expected; prior 53.3)
- Japanese yen strength (USD/JPY 155.59) stoked speculation of currency intervention following Treasury Secretary Bessent’s comments
Europe:
- Eurozone August Services PMI: 51.6 (vs. 51.7 expected; prior 51.7)
- Eurozone July PPI: +1.6% m/m (vs. +1.2% expected; prior -0.3%), +5.8% yr/yr (prior +4.6%)
- Germany’s August Services PMI: 49.7 (vs. 48.5 expected; prior 49.8)
- U.K.’s August Services PMI: 52.5 (vs. 52.8 expected; prior 52.1)
- France’s August Services PMI: 48.0 (vs. 48.4 expected; prior 49.6)
- Italy’s August Services PMI: 55.2 (vs. 53.6 expected; prior 52.5)
- Spain’s August Services PMI: 57.8 (vs. 59.0 expected; prior 58.3)
- Swiss Q2 GDP: +1.9% qtr/qtr (vs. +1.5% expected; prior +0.6%), +2.8% yr/yr
- Swiss August CPI: +0.4% m/m (vs. 0.0% expected; prior -0.1%), +0.8% yr/yr
- Germany’s IfW raised its 2026 growth forecast to 1.3% from 0.8%; ifo Institute raised its forecast to 1.4% from 0.8%
- Germany’s Chancellor Merz to meet with ECB officials ahead of next week’s policy meeting, which is expected to result in a rate hike
- EUR/USD: 1.1633
Economic Data
- July Trade Balance: -$88.6 billion (Briefing.com consensus -$89.6 billion); prior revised to -$71.2 billion from -$73.3 billion. Widening deficit expected to be a drag on Q3 GDP growth estimates.
- Q2 Productivity (Revised): 1.4% (consensus 1.4%); unchanged from advance estimate
- Q2 Unit Labor Costs (Revised): 1.2% (consensus 1.3%); prior 1.3%. Downward revision helped keep inflation concerns in check.
- Weekly Initial Jobless Claims: 206K (consensus 205K); prior revised to 204K from 203K. Low level continues to reflect a low-firing environment.
- Weekly Continuing Claims: 1.779 million; prior revised to 1.771 million from 1.778 million.
- ISM Services PMI (August): 55.4% (consensus 54.1%), up from 54.1% in July, reflecting accelerating services-sector growth; report noted no relief in prices paid, raising pass-through inflation risk.
Looking Ahead
- Friday, September 4: August Employment Situation report (nonfarm payrolls) — the marquee data release that will garner significant market attention following this week’s yield volatility and shifting Fed rate-hold expectations.
- Continued focus on Fed rate-path signals following Governor Waller’s dovish-leaning remarks, with markets now assigning a 49.6% probability to a September hold.
- Watch for follow-through in semiconductor stocks after Thursday’s intraday recovery from Broadcom-driven weakness.
- Next week: ECB policy meeting, with an expected rate hike following comments from Germany’s Chancellor Merz and ECB officials.