U.S. stocks moved higher on Wednesday as a steep pullback in Treasury yields eased pressure on equities and investors awaited minutes from the Federal Reserve’s divided July policy meeting. The Dow Jones Industrial Average gained about 0.4%, while the S&P 500 and Nasdaq Composite each advanced roughly 0.6% as stocks recovered from Tuesday’s sell-off.
The rebound gained momentum after the Treasury Department said it would significantly increase buybacks of longer-dated government debt, helping send bond yields lower from multiyear highs. A temporary pause on planned 50% tariffs on certain Canadian goods also improved sentiment, while investors continued to weigh earnings, consumer spending trends, and the Fed’s next move on interest rates.
Market Movers:
- Moderna (MRNA) +95%, Merck (MRK) +8%: Shares surged after the companies said their jointly developed mRNA cancer therapy, intismeran autogene, met its primary recurrence-free survival endpoint and a key secondary endpoint in a Phase 3 melanoma study when combined with Keytruda. The companies said the results showed statistically significant and clinically meaningful improvements over Keytruda alone and plan to pursue regulatory approvals.
- Estée Lauder (EL) +15%: Shares climbed after the beauty company beat fiscal fourth-quarter expectations and raised its fiscal 2027 adjusted operating-margin outlook. Organic sales rose 5% for a fourth consecutive quarter of growth, while management expects continued strength in Fragrance and Skin Care and a return to full-year growth in Makeup.
- Marvell Technology (MRVL) +11%: Shares jumped after the chipmaker expanded its partnership with Google around custom silicon supporting the TPU ecosystem, including AI inference accelerators, storage and network controllers, and memory-related products. Marvell also granted Google warrants to purchase up to 59 million shares, with much of the vesting tied to future custom-products revenue through fiscal 2033.
- SK Hynix (SKHY) +6%: Shares advanced after the memory-chip leader unveiled a massive shareholder-return program that includes repurchasing and canceling up to KRW 40 trillion of stock. The company also reiterated plans to return more than half of its free cash flow from 2025 through 2027 as booming AI memory demand drives record cash generation.
- WhiteFiber (WYFI) -22%: Shares plunged after the company priced an upsized $270 million convertible senior notes offering, with proceeds earmarked partly for data-center expansion and GPU infrastructure. The financing carries a 5% coupon and introduces potential dilution through an initial conversion price of roughly $33.84 per share.
- La-Z-Boy (LZB) -18%: Shares tumbled after the furniture maker missed fiscal first-quarter expectations and issued a second-quarter sales outlook below Wall Street forecasts. Revenue declined 3.4% year over year while margins weakened, and management pointed to choppy wholesale demand and continued spending on stores, advertising, pricing initiatives, and digital transformation.
- Evolution Petroleum (EPM) -11%: Shares fell after the energy producer priced a 3.7 million-share public offering at $3.25 per share, expected to raise about $12 million in gross proceeds. Investors focused on the dilution risk, with underwriters also receiving an option to purchase another 555,000 shares.
- ZIM Integrated Shipping Services (ZIM) -6%: Shares declined despite second-quarter revenue and earnings beating expectations as weaker operating income and cash generation weighed on sentiment. Uncertainty surrounding the company’s pending sale to Hapag-Lloyd also remained an overhang even as ZIM maintained its full-year adjusted EBITDA outlook of $2 billion to $2.4 billion.
Treasury Buybacks Give Stocks Some Relief
The Treasury market was one of Wednesday’s biggest catalysts after the U.S. Treasury Department announced plans to at least double buybacks across securities in the 10-year to 30-year portion of the curve. Bond prices rallied on the announcement, sending the 10-year Treasury yield down roughly 5 basis points to 4.65% and the 30-year yield down about 9 basis points to 5.20%.
That reversal offered welcome relief after long-term yields climbed to their highest levels in years earlier this week. Rising borrowing costs had weighed heavily on technology and other growth stocks, particularly as investors questioned how the government’s financing needs and the massive AI infrastructure buildout could keep pressure on global credit markets. Lower yields helped ease some of that valuation pressure Wednesday. Still, rates remain elevated enough that the bond market continues to pose a meaningful risk to equities if concerns about inflation, federal borrowing, or AI-related financing intensify again.
Fed Minutes Could Clarify a Divided Rate Debate
Investor attention now turns to the minutes from the Federal Reserve’s July meeting, when policymakers voted to hold interest rates steady despite three members favoring a hike. Markets will be looking for details on how officials weighed stubborn inflation against emerging weakness in the labor market.
Recent economic data have complicated that debate. July payrolls unexpectedly declined by 23,000, while both consumer and producer inflation showed signs of cooling, pushing traders toward expectations that the Fed will remain on hold in September. But policymakers have not ruled out additional tightening. Oil remains elevated, long-term yields are high, and inflation is still running above the Fed’s 2% target, leaving the central bank with little room for complacency.
Canada Tariff Pause and Consumer Spending Come Into Focus
Trade tensions eased somewhat after President Trump paused planned 50% tariffs on certain Canadian goods for three days, saying the two countries were nearing a deal. The reprieve followed last-minute negotiations and helped reduce fears of another immediate trade shock for North American supply chains. Retail earnings are also giving investors a closer look at the consumer. Lowe’s reported an earnings beat Wednesday but offered a cautious assessment of do-it-yourself spending, with management acknowledging continued pressure on larger discretionary home-improvement projects.
The warning adds to signs that consumers are becoming more selective as high mortgage rates, elevated prices, and borrowing costs constrain household budgets. That makes upcoming retail reports particularly important for determining whether consumer spending can remain strong enough to support economic growth through the second half of the year.
Looking Ahead
The Fed minutes are the next major test for markets, with investors searching for clues about just how divided policymakers remain and what would be required to put another rate hike back on the table. Any indication that officials are becoming more comfortable with cooling inflation and weaker employment could reinforce expectations for a September pause.
At the same time, Treasury yields, retail earnings, oil prices, and trade negotiations with Canada remain important swing factors. Wednesday’s rally shows how quickly sentiment can improve when bond-market pressure eases, but with valuations still elevated and monetary policy unsettled, investors will likely need continued stability in yields and inflation to keep the broader market moving higher.