At the start of a week packed with economic data that may influence the direction of Federal Reserve policy, stocks increased and bond yields decreased.
The S&P 500 stayed close to 4,400 during a trading session that was rather quiet. After reports of a potential settlement to pay over $5.5 billion to settle claims that it marketed faulty combat earplugs, 3M gained ground. In megacaps, Nvidia led gains. The yields on two- and five-year Treasury auctions reached their highest levels prior to the financial crisis of 2008.
The risk-off sentiment in August showed some signs of easing, but the US equity benchmark is still on track for its worst month since 2023 because the notion that higher rates will last longer has gained traction. At his Jackson Hole speech on Friday, Fed Chair Jerome Powell kept to the script and stated that policymakers are "prepared to raise rates further if appropriate," while emphasising that the central bank would "proceed carefully" and be guided by economic data.
