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August 28, 2026 - 17:20
4 minutes
(Bloomberg) — Wall Street traders sent stocks higher as Federal Reserve Chair Kevin Warsh’s vow to bring inflation under control bolstered investor confidence after a recent rout in longer-dated Treasuries.In his first major speech since taking the helm of the world’s top central bank, Warsh warned price pressures aren’t meaningfully slowing while pledging to achieve the central bank’s target. His remarks bolstered bets on a Fed hike this year, driving yields on two-year notes up nine basis points to 4.32%. Conversely, those on 30-year bonds fell. The S&P 500 extended this week’s gain.“Here is my standard: We must be confident that underlying inflation is moving to our objective, clearly and at sufficient speed. Otherwise, we have work to do. That’s our job,” Warsh said in remarks prepared for the Fed’s annual conference in Jackson Hole, Wyoming on Friday.Warsh added that financial conditions are not currently restrictive and interest rates are the Fed’s “predominant tool” for achieving its mandate, though he stopped short of signaling he would support an interest-rate hike when Fed officials gather in September.“I would say Warsh was successful in reestablishing confidence,” said Larry Holzenthaler at Catalyst Funds. “He came across as very focused on inflation and bringing it back in line with the Fed’s 2% target. The market seems to be reacting exactly the way the Fed wants.”“I believe he did a very good job of laying out a pathway, a framework, a playbook and the rules of his road on what he’s watching out for and what will guide him in terms of properly calibrating monetary policy as best he can,” said Peter Boockvar, author of the Boock Report.Warsh’s speech at the Jackson Hole symposium delivered a far clearer – and hawkish – message than his last press conference appearance, according to Capital Economics.Hikes are not guaranteed, but the Fed chief is now at least suggesting he is on board with them if economic growth remains strong and inflation remains a bit too firm, the economists added.“The caveat is that we think the remaining data likely will show some further incremental progress and suspect Warsh may well also hope that this is the case,” said Krishna Guha at Evercore. “So we hold back from moving odds-on for September at this juncture and instead view this as close to a coin toss.”Corporate Highlights:A consortium of buyout firm Advent and payment processor Stripe has decided to abandon its pursuit of fintech pioneer PayPal Holdings Inc., a potential deal that would have ranked as one of the biggest-ever leveraged buyouts, according to people familiar with the matter. Gap Inc. named a retail industry veteran to head Old Navy while profit outpaced estimates, offsetting a sales decline at the value chain and lower sales guidance. Eli Lilly & Co.’s blockbuster diabetes drug Mounjaro won US approval to reduce the risk of serious cardiovascular problems, broadening the medicine’s reach beyond controlling blood sugar and strengthening its position in the increasingly competitive market for GLP-1 drugs. Chevron Corp. and other US energy companies are close to finalizing deals to invest billions of dollars to help rebuild Venezuela’s oil fields, according the Wall Street Journal. BioNTech SE and Roche Holding AG abandoned a trial of a personalized cancer vaccine, dashing hopes that had been raised by a rival drugmaker’s recent success in the same field. Some of the main moves in markets:StocksThe S&P 500 rose 0.4% as of 11:19 a.m. New York time The Nasdaq 100 rose 0.2% The Dow Jones Industrial Average rose 0.4% The Stoxx Europe 600 rose 0.6% The MSCI World Index rose 0.3% CurrenciesThe Bloomberg Dollar Spot Index rose 0.3% The euro fell 0.4% to $1.1606 The British pound fell 0.3% to $1.3557 The Japanese yen fell 0.4% to 159.97 per dollar CryptocurrenciesBitcoin fell 0.8% to $79,452.23 Ether was little changed at $2,509.69 BondsThe yield on 10-year Treasuries advanced two basis points to 4.70% Germany’s 10-year yield advanced two basis points to 3.27% Britain’s 10-year yield advanced three basis points to 5.06% CommoditiesWest Texas Intermediate crude fell 0.4% to $83.18 a barrel Spot gold fell 1% to $4,554.99 an ounce ©2026 Bloomberg L.P.
