Wall Street moved higher on Wednesday as the drift in oil prices paused and New York Fed President John Williams said he saw no clear signs right now that the Federal Reserve would need to raise rates in September. The Dow Jones Industrial Average rose 0.8%, the S&P 500 climbed 0.6% and the Nasdaq Composite added 0.5% as investors reacted to a lighter inflation scare and a softer policy signal at the same time.
The move mattered because oil had been pressing near $95 a barrel and the 10-year Treasury yield was still sitting at 4.79%, its highest level since 2023, with the 30-year yield holding at 5.26%. Williams told CNBC that the rise in bond yields could reflect a strong economy rather than a fresh run-up in inflation expectations, and that helped take some of the edge off a market that had been leaning hard toward tighter policy. In the bond market, even a small change in the odds can move quickly through stocks, and Wednesday showed that clearly.
The reason traders were watching so closely was simple: the war in Iran had pushed energy markets back into focus after President Trump threatened on Tuesday to hit Iran much harder if it retaliated against a barrage of airstrikes launched the same day, while Iran said it was targeting US military bases in Jordan and Bahrain. That kept crude elevated even after the latest surge stalled, with Brent crude futures still near $95 a barrel and WTI near $90. The oil move had not vanished; it had just stopped accelerating, which was enough for equities to catch a bid without fully escaping the pressure.
There was still a gap between the market’s relief and the risks underneath it. ADP said the US private sector added 38,000 jobs in August, below the 47,000 economists expected, but not weak enough to force a new inflation story on its own. Broadcom and Snowflake were due to report after the closing bell on Wednesday, giving investors another read on corporate demand, while Friday’s monthly jobs report was next and likely to test whether the day’s calmer tone could last.
For now, the clearest read is that stocks found room to rebound only because oil stopped climbing and Williams pushed back on the idea of an immediate September hike. If crude keeps drifting near current levels and bond yields stay elevated, the next move will come from whichever of those forces breaks first.
