Morning Brief: Russia‑Ukraine peace signals emerge; Waller hints at steady rates if inflation cools; US equities surge over 1%

【Key Snapshot】

· 🕊️ Rare peace signals emerge from Russia and Ukraine. Putin says a deal remains achievable. Fed Governor Waller signalled he could keep rates unchanged should inflation keep cooling, prompting traders to dial back rate‑hike bets.

· 📊 Markets await August Non‑Farm Payrolls today, the first major print among the “next‑two‑weeks data” flagged by Waller that will directly reshape September rate‑hike odds.

【Market Outlook】

Core Events

‑ Waller delivers dovish‑leaning remarks: Fed Governor Waller noted he would favour holding rates steady this month if August inflation figures show further easing in price pressures, stressing that August inflation data would carry “considerable weight”. → Dow Jones +1.18% at 53686.11; S&P 500 +1.06% at 7747.71; Nasdaq Composite +1.40% at 26584.06. 2‑year Treasury yield fell 5.6 bps to 4.33%.

Exclusive View

Waller’s dovish tilt ahead of the September FOMC marks a nuanced shift from his hawkish tone at Jackson Hole. His conditional stance that rates can stay on hold amid cooling inflation acted as a key catalyst for risk assets. Consensus calls for 55,000 new jobs and 4.1% unemployment. Moderate‑to‑soft payrolls would reinforce the no‑hike narrative, while a hot print would force markets to reprice hawkish scenarios.

【Overnight Market Performance】

‑ US Equities: Dow Jones +1.18% at 53686.11; S&P 500 +1.06% at 7747.71; Nasdaq Composite +1.40% at 26584.06.

‑ European Equities: STOXX Europe 600 +0.5% at 649.1. FTSE 100 +0.7%, DAX +0.63%, CAC 40 +0.07%.

‑ Fixed Income: 2‑Year US Treasury yield ‑5.6 bps to 4.33%.

‑ Commodities: WTI crude +0.32% at $91.30/bbl; Brent crude ‑0.12% at $95.52/bbl. Spot Gold +2.37% at $4491.85/oz; Silver +2.52% at $66.79/oz.

‑ FX: US Dollar Index ‑0.69% at 98.91; EURUSD +0.32% at 1.1624; GBPUSD +0.27% at 1.3521; USDJPY at 155.759, yen down nearly 3% across two sessions.

‑ Crypto: Bitcoin +5.33% at $81429.53, highest close since May 14.

【Macro Highlights】

1. 🕊️ Russia‑Ukraine send peace signals, Putin says a settlement is still within reach. Ukraine noted new developments are expected in diplomatic efforts. Geopolitical risk premium edged lower.

Insight: This marks the most constructive diplomatic rhetoric in months. Still, prior peace overtures from Russia have preceded military escalations, so watch for divergence between diplomatic statements and battlefield actions.

2. 🏛️ Waller: Rates can stay unchanged if inflation keeps cooling. Waller stressed August inflation prints will be highly consequential. Should price pressures ease further, he leans toward keeping rates steady, driving reduced market pricing for rate hikes.

Insight: Waller places inflation, not employment, at the centre of September policy decisions. That makes next Wednesday’s August CPI the most critical release ahead of the FOMC meeting.

3. 📊 Initial jobless claims edge up to 206,000; labour market remains stable. Weekly claims rose by 2,000, lay‑offs stay muted, allowing Fed policymakers to focus on inflation risks stemming from Middle East conflicts.

【Corporate News】

1. 💾 NVIDIA acquires Hugging Face for USD 12.93 billion, betting open‑source AI models will drive future demand. The deal extends NVIDIA’s footprint beyond hardware into upstream developer infrastructure.

2. ⚠️ Major AI services including ChatGPT, Claude and Grok suffered near‑four‑hour simultaneous outages, services have since been restored. The collective disruption drew attention to systemic vulnerabilities within centralised AI infrastructure.

【Today’s Key Watchlist】

· 📊 US August Non‑Farm Payrolls. Consensus: +55,000 jobs vs prior ‑23,000; unemployment rate forecast 4.1%. Waller cited this as the first checkpoint in the “next‑two‑weeks data set”, prints will calibrate September rate‑hike probabilities.

· 🗣️ Cleveland Fed President Hammack delivers opening remarks. 2026 FOMC voter; focus on her inflation and rate‑path outlook.

· 🇨🇦 Canada August employment report due concurrently.