Sunday morning has a particular kind of calm on Wall Street. The screens are dark, the futures desks are quiet, and everybody who moved markets last week is home with their families. But if you stood on any trading floor this past Friday and asked what kept people up at night, the answer would not have been one thing. It would have been three: the new path for interest rates, a meeting between two presidents, and one grocer in Issaquah, Washington.
Let me walk you through the week the way it actually lands.
Monday is a breath of fresh air. According to Scotiabank’s September release calendar, there is no major U.S. economic data scheduled for September 21, which means the market gets to digest last Wednesday’s Federal Reserve decision without a new number shouting over it. That decision was a big one: the Fed raised interest rates for the first time in three years, an effort to tamp down inflation that investors keep describing as stubbornly above target, Reuters reported on September 18. The hike itself was widely expected and mostly priced in. What was not priced in was the uncertainty about how many more hikes could follow, especially under a new Fed chair, Kevin Warsh, who has made it clear he has no appetite for the forward guidance his predecessors loved. He will not tell the market where rates are going. He wants everyone to read the data themselves.
That is why the real show this week is not data, but talk. Fidelity’s economic calendar shows a parade of Fed speakers: Austan Goolsbee on Monday, John Williams, Philip Jefferson, and Thomas Barkin on Tuesday, Williams and Barkin again Wednesday, Beth Hammack and Anna Paulson Thursday, and Hammack again Friday. Each speech is a potential breadcrumb. The market will be parsing every word for hints about the pace of this new hiking cycle.
Then there is the geopolitics. An anticipated meeting between President Trump and Chinese President Xi Jinping is expected later this week, Kalkine reported, and it could touch on AI cooperation and semiconductor restrictions. Meanwhile, Investor’s Business Daily noted that the Iran conflict and its long list of economic effects shows no sign of improving, and oil prices have been running from headline to headline. There is also the matter of Congress: the House adjourned Wednesday until after the midterm elections, which IBD points out effectively froze any further progress on crypto regulations or AI legislation.
And then, Thursday, Costco. The warehouse giant reports its fiscal fourth quarter after the closing bell on September 24, and in a week with little other company news, it is the closest thing to a tentpole earnings event left on the calendar.
As for where we stand: Thursday’s session left the S&P 500 up more than 11% for the year, about 2% below its mid-August record high, Reuters reported. U.S. crude dropped to $101 a barrel and the 10-year Treasury yield fell to 4.93% late in the session, both sliding back below what Art Hogan of B. Riley Wealth called “psychological lines in the sand” at $100 oil and 5% yields. Below those lines, Hogan said, “lets market participants breathe a brief sigh of relief and get more involved.”
The damage from the Fed decision was not evenly spread. CNBC’s Jim Cramer noted that the Dow has lost roughly 3% so far in September while the S&P 500 has edged up 0.46% and the Nasdaq has gained 0.58%. The blue-chip index also absorbed most of the damage from the Fed’s decision, falling 1.7% on the week. Seasonality is no friend either: the Dow has averaged a 0.8% September loss since 1950. “Remember, September is the cruelest month,” Cramer said. “Here’s hoping we’ll have a relatively sedate couple of weeks.”
Here is the day-by-day map, drawn from the Scotiabank and LiteFinance calendars:
- Monday, September 21: No major data. Watch the People’s Bank of China’s rate decision and the Fed speaker circuit.
- Tuesday, September 22: Richmond Fed manufacturing survey at 10 a.m. ET, plus Williams, Jefferson, and Barkin.
- Wednesday, September 23: Flash PMIs for Germany, the eurozone, the UK, and the U.S., the week’s cleanest read on whether growth is holding up.
- Thursday, September 24: Weekly jobless claims at 8:30 a.m., the current account and new home sales, the Swiss National Bank’s rate decision, and Costco earnings after the close.
- Friday, September 25: August durable goods orders at 8:30 a.m. and the final University of Michigan consumer sentiment reading at 10 a.m.
My take: this is one of those weeks where the absence of data is the story. With so few numbers to chew on, the market’s imagination gets louder, not quieter. Fed speakers, two presidents, and one grocer’s earnings will have to fill the space. Watch the 10-year yield more than anything else. If it climbs back toward 5%, the rally that breathed Thursday could start gasping again. If it stays where it is, this September might just defy its reputation.
As of 8:30 a.m. CT, Sunday, September 20.
