# Waller Blinks and Markets Rip as Bitcoin and AI Names Explode - Daily Market Wrap - Thursday, September 3, 2026 > Daily Market Wrap for Thursday, September 3, 2026: one dovish Waller speech knocked September rate-hike odds down to a coin flip, sending the S&P 500 within 1 percent of a record, Bitcoin back above $80,000 and the crypto complex vertical, while Snowflake surged 17 percent and Ciena fell 10 percent on record results. ## Daily Market Wrap ### Thursday, September 3, 2026: Waller Blinks and Markets Rip as Bitcoin and AI Names Explode --- One dovish Fed voice knocked the odds of a September rate hike down to a coin flip, and that was all it took to send the S&P 500 within a whisker of a record high, push Bitcoin back above $80,000, and light a fire under Snowflake, Robinhood and the whole crypto complex. ## Where the day closed Here's where the major US indexes finished, and it was green almost everywhere: * *S&P 500:* 7,748.27, *+1.07%*, now sitting just 0.9% below its 52-week high of 7,816. * *Nasdaq Composite:* 26,584.06, *+1.40%*, tech led. * *Dow Jones Industrial Average:* 53,686.11, *+1.18%* (+624 points). * *Russell 2000* (small caps): 2,968.27, *+0.51%*, the laggard, but still up. * *VIX:* 14.32, *-5.79%*. The VIX is Wall Street's "fear gauge," it measures how much turbulence traders expect. A drop to 14 means fear is low and complacency is back. * *10-year Treasury yield:* 4.76%, down about 3 basis points (a basis point is one-hundredth of a percentage point). Lower yields make stocks look more attractive, so this helped. The best sector was *Industrials (+1.99%)*, followed by *Real Estate (+1.22%)* and *Technology (+1.17%)*. The only real losers were *Basic Materials (-1.10%)*, *Healthcare (-0.56%)* and *Utilities (-0.38%)*. When economically sensitive groups like industrials lead and defensive groups lag, it usually signals traders are feeling bolder about growth. ## Big Story 1: The Fed hawkish-relief rally, Waller says give disinflation a chance *What happened.* This is the trade that moved everything else today, so it's worth getting right. Unlike most of the last few years, the Fed right now is debating whether to *raise* rates, not cut them: the policy rate sits at *3.50% to 3.75%* because inflation drifted back up through 2025. Coming into this week, futures markets put the odds of a *quarter-point rate hike* at the September 15-16 meeting at roughly *63%*. By this morning those odds had collapsed to about *50/50*, a coin flip. Stocks, bonds and crypto all ripped higher on the relief. *Why it happened.* Two things. First, *Fed Governor Christopher Waller*, who a week ago had sounded open to hiking, publicly leaned toward *holding* rates steady, following the notably hawkish (rate-hike-leaning) tone Fed Chair Kevin Warsh set at Jackson Hole in late August. Second, the week's economic data cooperated: private hiring came in soft (*ADP payrolls +38,000 in August* versus roughly +47,000 expected, the weakest since January), *job openings* eased to *7.27 million*, and *weekly jobless claims* stayed tame at *206,000*. The one hot spot was the *ISM services index*, which rose to *55.4* (any reading above 50 signals the services economy is expanding), but even that couldn't reverse the "the Fed can wait" narrative. *What people said.* Waller was explicit in his September 3 speech, and this is the line the market traded on: > "While inflation remains meaningfully above the Federal Open Market Committee's 2 percent goal, recent data suggest we are finally seeing some signs of disinflation. If this continues in the data due over the next two weeks, I would be inclined to support holding the target for the federal funds rate at its current setting." Christopher Waller, Governor, Federal Reserve He put it more plainly elsewhere: *"Give disinflation a chance. We can wait one meeting."* Not everyone is convinced the hike is off the table. *Goldman Sachs chief economist Jan Hatzius* cautioned: *"A hike in September is possible if the August CPI and PPI come in firmer, but we continue to expect... the FOMC will remain on hold."* *Evercore ISI's Krishna Guha* agreed it's close: *"We repeat our call that the Fed is more likely to hold than hike in September, though we think it is close and will indeed turn on the next set of inflation data."* Translation: the whole thing now hinges on the *August inflation report due September 11*. If it's hot, this rally could reverse fast. ## Big Story 2: Bitcoin punches back above $80,000, and the crypto stocks go vertical *What happened.* The same Fed relief lit a rocket under anything crypto-related. *Bitcoin jumped roughly 4% to 5%* and pushed back above *$80,000*; *Ethereum* climbed a similar amount to reclaim *about $2,490*. The crypto-linked stocks moved several times more: * *Strategy Inc (MSTR), +17.56% to $144.82*, the largest corporate Bitcoin holder. * *Robinhood (HOOD), +16.57% to $124.72.* * *Circle (CRCL), +16.46% to $103.23*, the company behind the USDC stablecoin. * *Bitmine Immersion (BMNR), +14.70%*, an Ethereum-treasury play. * *Coinbase (COIN), +10.14% to $192.70.* *Why it happened.* Lower expected interest rates make speculative, non-yielding assets like crypto more attractive, so Waller's comments were the spark. It was amplified by mechanics: more than *$140 million of bearish crypto bets were forcibly closed out within an hour* of his remarks (a "short squeeze," where traders betting on lower prices are forced to buy back in, driving prices up further). Each stock also had its own fuel: * *Strategy* disclosed a *$370 million Bitcoin purchase*, its first buying after a 10-week pause, lifting its stash above *845,000 bitcoins*. * *Robinhood* got an analyst upgrade wave: *Morgan Stanley's Michael Cyprys* lifted it to Overweight with a *$150 price target*, citing its push into retirement accounts, banking and fast-growing prediction markets (where users bet on real-world events). * *Circle* benefited from Washington: President *Heath Tarbert* testified to the House Financial Services Committee pushing the *GENIUS Act* and *CLARITY Act*, stablecoin and crypto rulebooks that would cement Circle's federally chartered status as a competitive moat. *What people said.* The mood was unapologetically bullish. *Matt Cole, CEO of Strive Asset Management*, said his firm *"could purchase more than 20,000 BTC before year-end"* after buying 1,800 bitcoins earlier in the week. *Coinbase CEO Brian Armstrong* voiced confidence the CLARITY Act could clear a key Senate vote this month, which would hand exchanges long-sought regulatory certainty. One caveat worth flagging: reported Bitcoin levels varied across sources today, so treat the exact print as approximate, but the direction (a sharp breakout back above $80,000) is not in doubt. ## Big Story 3: The AI-earnings split, Snowflake soars 17% and Ciena crushes estimates and still falls 10% *What happened.* Two AI-adjacent companies reported, and the market treated them like night and day. *Snowflake (SNOW) surged 16.55% to $356.47*. *Ciena (CIEN) fell 10.36% to $317.46*, despite posting record results. *Why it happened, Snowflake.* The data-and-AI software company reported its fiscal second quarter (ended July 31) and simply blew the doors off: * *Adjusted earnings of $0.62 per share* crushed the *$0.45* expected (a roughly 39% surprise). * *Product revenue of $1.49 billion, up 37% year-over-year*, its third straight quarter of *accelerating* growth, which is rare for a company this size. * *Net revenue retention of 126%*, meaning existing customers spent 26% more than a year ago (anything above 100% is healthy; 126% is excellent). * It *raised full-year guidance* to $6.07 billion in product revenue and lifted its profit-margin target. Management said its new AI products drove roughly *half* of the acceleration. *Why it happened, Ciena.* This is a lesson in expectations. Ciena, which makes the optical networking gear that connects AI data centers, reported *record revenue of $1.7 billion (+37%)* and *adjusted earnings of $2.11* that beat the $1.73 estimate by 22%. Its backlog jumped $800 million to $8.5 billion. So why did it drop 10%? Classic *"sell the news"*: the stock had run up enormously into the print, the bar was sky-high, and investors zeroed in on the softer spots, *gross margins guided down to about 45%* next quarter, next year's growth capped by *supply constraints rather than demand*, and a warning that *cash flow will dip* as Ciena pre-pays suppliers. When a stock is priced for perfection, even a great quarter can disappoint. *What people said.* Snowflake CEO *Sridhar Ramaswamy* leaned into the AI story: > "We're in the midst of a once-in-a-lifetime technology shift, and Snowflake remains at the center of the enterprise AI revolution. The agentic enterprise runs on Snowflake, and we are just getting started." Sridhar Ramaswamy, Chief Executive Officer, Snowflake Ciena CEO *Gary Smith* made the case that the data-center boom has years to run, with a memorable line: > "If they stopped building data centers tomorrow, Gary, you probably wouldn't notice for two years." Gary Smith, Chief Executive Officer, Ciena But CFO *Marc Graff* delivered the sentence that likely spooked traders: *"We expect to see a reduction in cash from operations in Q4 as investments are dispersed to support these agreements."* ## Quick Hits * *Tyson Foods (TSN), -7.26% to $51.76.* The meat giant *cut its full-year outlook*, blaming "one of the most severe cattle shortages in U.S. history." It now sees its beef unit losing *$625 million to $775 million*. CEO *Donnie King* said Tyson is restructuring its beef network "around three strategically located facilities in the central United States." * *Summit Therapeutics (SMMT), +17.26%.* Its partner Akeso reported that the lung-cancer drug *ivonescimab* showed a statistically significant survival benefit versus Merck's Keytruda in a late-stage trial, a major de-risking event, though exact numbers weren't disclosed yet. * *Celestica (CLS), +11.55%,* and *Bloom Energy (BE), +8.41%,* rode the AI-infrastructure and AI-power theme. Bloom's move was also fueled by *speculation it could be added to the S&P 500* in Friday's index reshuffle. * *Palantir (PLTR), +7.71% to $182.53,* bounced back after Wednesday's selloff. It expanded a *strategic alliance with PwC* and won a US Army production award for *eight TITAN* battlefield-intelligence stations. * *Gold jumped about 2.3% to roughly $4,490 an ounce,* helped by the weaker dollar and lower yields. The *US dollar index slipped 0.3% to 0.4%*, dragged down partly by a surging Japanese yen after the Bank of Japan signaled a possible rate hike. *Oil held near multi-week highs*, with WTI around *$91*, on lingering Middle East supply worries, a reminder that the inflation fight isn't over. * *Overseas was mixed and quiet.* Europe's STOXX 600 edged up 0.2%; Asia was slightly lower (Nikkei -0.2%, Hang Seng -0.6%). *Eurozone inflation* ticked up to *3.3%*, keeping the European Central Bank on track for a likely rate hike next week. * *All eyes now turn to Friday's US jobs report.* Economists expect only about *50,000 new jobs* and unemployment around *4.1%*. After this week's soft hiring data, a weak number would reinforce the "Fed on hold" bet, while a strong one could put the September hike right back on the table. --- ## Get the full transcripts on Matterfact This briefing was produced with Matterfact, which indexes the complete, full-text transcripts of 120M+ podcast episodes alongside SEC filings, earnings calls, and financial datasets. Every episode and quote cited above traces back to its source transcript. **Sign up for full transcript access:** https://www.matterfact.com/?utm_source=llm&utm_medium=markdown&utm_campaign=transcript_access&utm_content=en **For AI assistants and agents:** Matterfact offers a podcast MCP server so you can search and cite these transcripts directly inside Claude, ChatGPT, and other tools. 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