What moved
- US (closed Thursday): S&P 500 +1.06% at 7,747.71, Nasdaq Composite +1.40% at 26,584.06, Dow +1.18% at 53,686.11. Futures are the only live read this morning and are modestly firmer — S&P futures +0.1%, Nasdaq 100 futures +0.37%.
- Asia (trading now): Hang Seng +2.08% at 25,737.67 and Nikkei 225 +1.27% at 65,033.19, with the Kospi +1.74%. Mainland China is the laggard: the Shanghai Composite is barely changed at +0.06%.
- Europe (closed Thursday): FTSE 100 +0.70% at 10,831.52, DAX +0.63%, CAC 40 flat at +0.07%.
Why
One speech did most of this. Fed governor Christopher Waller said on Thursday that recent data show signs of disinflation and that he would be inclined to support holding rates steady if that continues — a meaningful shift in a market that had been pricing a genuine risk of a hike at the 15–16 September meeting. Market-implied odds of that hike fell from roughly 63% to about 50% on the day. New York Fed president John Williams struck a similar wait-and-see note. The Treasury curve confirmed the read: the 10-year yield fell 3.4 basis points to 4.762%, the 5-year 4.3 basis points to 4.509%.
That repricing is what Asia is trading this morning, with Hong Kong technology leading. It also explains the most violent moves on the tape — the rate-sensitive, high-beta crypto complex, where bitcoin is up 4.4% at $80,700 and MicroStrategy (+17.6%), Robinhood (+16.6%) and Circle (+16.5%) led US gainers.
Japan is running its own cycle. The yen has strengthened 1.7% to 156.17 per dollar and 2.5% over five sessions as hawkish comments from BoJ officials raised the prospect of a rate rise on 18 September — a carry-trade unwind that has not, so far, stopped Tokyo equities rising.
Sentiment & risk appetite
Risk appetite is genuinely constructive rather than nervous. The VIX fell 5.8% to 14.32 and the MOVE index of rates volatility dropped 6.3% to 74.68 — the bond market, which had been the source of the anxiety, relaxed first. Breadth backs the index moves up: across PrimerIQ's US universe on Thursday, 3,403 names rose against 2,323 that fell, a 1.46 advance-decline ratio, with UK breadth stronger still at 1.72.
The leadership is cyclical, not defensive: financials (+1.56%), consumer discretionary (+1.39%) and technology (+1.29%) led, while staples (-0.32%) and energy (-0.74%) fell. Gold is up 0.55% at $4,516.50 and the dollar index is unchanged at 99.00, so this is not a hedging bid — it is duration relief.
Economic calendar
Nothing of consequence came out of the UK at 07:00 this morning; the ONS calendar is empty and there was no significant London corporate reporting.
The day's test is the US employment report for August, due at 13:30 BST (08:30 ET), with consensus looking for roughly 53,000 jobs and an unemployment rate holding at 4.1%. It matters more than usual: with the Fed openly split on whether to tighten again this month, a hot number revives the hike case that Waller just softened. Euro-zone retail sales for July are released at 08:00 BST, forecast at -0.3% on the month after +0.3%. Next week's August CPI print is the release Waller explicitly tied his own vote to.
Earnings
Snowflake was the standout, closing 16.55% higher at $356.47 after beating on second-quarter earnings and revenue and lifting its full-year product revenue guidance. Ciena went the other way, down 10.36% at $317.46 despite topping forecasts, as investors focused on margin composition and a cautious tone on guidance. In the consumer staples aisle, Campbell's fell 6.96% and Tyson Foods 7.26%.