US stocks surge as bond yields tumble amid signs of slowing growth in the US and Europe

• US stocks surged more than 1% on Wednesday as the 10-year US Treasury rate tumbled 15 basis points.
• The decline in interest rates came after economic data showed a slowdown in US business activity earlier this month.
• Investors are anticipating Nvidia's second-quarter earnings report and Fed Chair Jerome Powell's Jackson Hole speech.

US stocks surged more than 1% on Wednesday while interest rates tumbled after economic data showed slowing US business activity earlier this month.

Data from the S&P Global flash composite output index fell showed the slowest pace of growth in six months, with the manufacturing index falling 1.6 points to 50.4. Meanwhile in Europe, private sector activity declined at the fastest pace since November 2020, according to data from S&P Global.

The decline in interest rates calls into question the underlying strength of the economy, but it also provides some relief for stock prices, as it plays into hopes that the Federal Reserve might be finished with its interest rate hikes.

Investors are awaiting Nvidia's second-quarter earnings report after the market close today, and the company has some high expectations to meet.

Another event on investors' radar this week is Fed Chairman Jerome Powell's Friday speech at the Jackson Hole Symposium. Investors will be looking for any clues from Powell about the future direction of interest rates.

Here's where US indexes stood at the 4:00 p.m. close on Wednesday:

• S&P 500: 4,436.13, up 1.11%

• Dow Jones Industrial Average: 34,474.17, up 0.54% (+185.34 points)

• Nasdaq Composite: 13,721.03, up 1.59%

Here's what else happened today:

• Bill Gross said investors are set for disappointment as their expectations of an AI revolution continue to grow.
• Tesla stock has lost nearly $200 billion in market value over the past month as it sees surging inventories of its electric vehicles.
• Vladimir Putin attacked the US dollar ahead of the BRICS summit as more countries band together to de-dollarize their economies.
• Luxury watch thefts have topped $1.3 billion over the past two years, and the Rolex brand is the favorite target of thieves.
• Peloton plunged 22% after earnings revealed falling subscribers and steep costs related to its bike seat recall.
• Housing is even more unaffordable than it was at the peak prior to the 2008 crisis, as mortgage rates touch 23-year highs

In commodities, bonds, and crypto:

• West Texas Intermediate crude oil fell 1.36% to $78.56 a barrel. Brent, the international benchmark, dropped 1.26% to $82.97 a barrel.
• Gold rose 1.05% to $1,946.20 per ounce.
• The yield on the 10-year Treasury bond declined 14 basis points to 4.18%.
• Bitcoin jumped 2.52% to $26,696.