STRAIGHT FROM THE TRADING FLOOR
by Michael P. Reinking, CFA
Published on 9/28/26 (a/o 9:00 am)
Good morning,
Last week was a dynamic headline driven week. Geopolitics were at the forefront with the UNGA in NYC, President Xi visiting the White House and Iran negotiations. The other focal point was the rise of AI agents which helped keep a bid in chips and other AI hardware/infrastructure stocks but also brought with it a new twist on the AI disruption trade weighing on financials and online travel companies. The S&P 500 ended the week up just over 1% though breadth was poor with the equal-weight and small and midcap indices ending the week modestly lower. This has been a consistent dynamic since rates started moving higher at the end of August following Chair Warsh’s Jackson Hole speech. Over that time 2yr yields are up ~65bps while 10yr yields are up ~50bps. The S&P 500 is essentially unchanged while other indices are down ~5% (see chart below).
US futures have been under pressure overnight as rates and oil prices continue to move higher. Over the weekend, President Trump rejected Iran’s most recent proposal though this morning there are reports that mediators are expected to meet with US/Iran officials again early this week. Those headlines along with reports that Saudi Arabia’s East West pipeline has resumed oil exports have helped oil prices pullback modestly from the overnight high, currently up ~2%. This is pushing Treasury yields up ~5bps across the curved reversing much of Friday’s pullback. Tech stocks are under pressure in the pre-market as security concerns are back in focus with Open AI reportedly pausing training of its latest model related to rogue agents. The company has its Open AI Dev Day tomorrow with speculation that it will unveil its own personal Agent to compete with Muse. Speaking of rogue agents, this morning Nvidia (+2%) announced it is launching the Nvidia Open Agent Safety Platform which Jensen Huang said will keep those agents in their sandbox and from misbehaving. The stock moved higher after the company announced that it is increasing its buyback by $150B to $235B and there are also reports that it is considering increasing its investment in Anthropic. These headlines and the pullback in oil prices have helped futures bounce off the lows. S&P futures are down ~0.35% while Dow and Russell futures are off ~0.5%.
The only economic data on the calendar today is Dallas manufacturing after the open. There a couple of Fed speakers throughout the day. Yields are moving higher driven primarily by oil up ~5bps. The USD index is modestly higher trading just under last week’s ~$101.
Global markets were mixed overnight with the rise in oil/yields weighing on sentiment. Tech heavy indices in Asia closed lower. South Korea was off nearly 3% with the memory giants down ~5%. The Nikkei fell nearly 1% the weakness was pretty broad based though financials closed modestly higher. Local yields continue to march higher. The currency fell overnight as officials continue to threaten additional intervention. Local markets in China were lower with the Shanghai Composite falling nearly 2%. The US and China published the details of a “30 for 30” list of $30B of products recommended for reduced tariffs, not to be confused with the ESPN documentary series. US goods covered under the agreement include ag, lumber, cosmetics and med devices. Impacted China imports include consumer appliances, toys and car seats. In addition, China will import 10ml metric tons of US coal. China’s industrial profits fell to 15.7% from 17.6% in August. The Hang Seng bucked the weakness closing up 0.5%. European indices are holding on to modest gains with energy, staples and retail outperforming. The FTSE 100 is outperforming up 0.5%. The government announced a new plan to help first time home buyers helping home builders.
ICE Brent is up ~2% but about $2 off the morning highs. US nat gas prices are down ~3% giving back some of last week’s gains. The precious metals complex is under significant pressure breaking below recent lows. Gold and silver are both decisively breaking below their respective 50d ma’s down 3% and 5%, respectively. Ag is also under pressure. Crypto has pulled back from overnight highs about where things left off on Friday.
Economic Data:
US:
Last week was a dynamic headline driven week. Geopolitics were at the forefront with the UNGA in NYC, President Xi visiting the White House and Iran negotiations. The other focal point was the rise of AI agents which helped keep a bid in chips and other AI hardware/infrastructure stocks but also brought with it a new twist on the AI disruption trade weighing on financials and online travel companies. The S&P 500 ended the week up just over 1% though breadth was poor with the equal-weight and small and midcap indices ending the week modestly lower. This has been a consistent dynamic since rates started moving higher at the end of August following Chair Warsh’s Jackson Hole speech. Over that time 2yr yields are up ~65bps while 10yr yields are up ~50bps. The S&P 500 is essentially unchanged while other indices are down ~5% (see chart below).
US futures have been under pressure overnight as rates and oil prices continue to move higher. Over the weekend, President Trump rejected Iran’s most recent proposal though this morning there are reports that mediators are expected to meet with US/Iran officials again early this week. Those headlines along with reports that Saudi Arabia’s East West pipeline has resumed oil exports have helped oil prices pullback modestly from the overnight high, currently up ~2%. This is pushing Treasury yields up ~5bps across the curved reversing much of Friday’s pullback. Tech stocks are under pressure in the pre-market as security concerns are back in focus with Open AI reportedly pausing training of its latest model related to rogue agents. The company has its Open AI Dev Day tomorrow with speculation that it will unveil its own personal Agent to compete with Muse. Speaking of rogue agents, this morning Nvidia (+2%) announced it is launching the Nvidia Open Agent Safety Platform which Jensen Huang said will keep those agents in their sandbox and from misbehaving. The stock moved higher after the company announced that it is increasing its buyback by $150B to $235B and there are also reports that it is considering increasing its investment in Anthropic. These headlines and the pullback in oil prices have helped futures bounce off the lows. S&P futures are down ~0.35% while Dow and Russell futures are off ~0.5%.
The only economic data on the calendar today is Dallas manufacturing after the open. There a couple of Fed speakers throughout the day. Yields are moving higher driven primarily by oil up ~5bps. The USD index is modestly higher trading just under last week’s ~$101.
- US 2yr +5bps to 4.91%, 5yr +5bps to 5.04%, 10yr +5bps to 5.21%, 30yr +3bps to 5.52%
- USD index: +$0.19 to $100.90
Global markets were mixed overnight with the rise in oil/yields weighing on sentiment. Tech heavy indices in Asia closed lower. South Korea was off nearly 3% with the memory giants down ~5%. The Nikkei fell nearly 1% the weakness was pretty broad based though financials closed modestly higher. Local yields continue to march higher. The currency fell overnight as officials continue to threaten additional intervention. Local markets in China were lower with the Shanghai Composite falling nearly 2%. The US and China published the details of a “30 for 30” list of $30B of products recommended for reduced tariffs, not to be confused with the ESPN documentary series. US goods covered under the agreement include ag, lumber, cosmetics and med devices. Impacted China imports include consumer appliances, toys and car seats. In addition, China will import 10ml metric tons of US coal. China’s industrial profits fell to 15.7% from 17.6% in August. The Hang Seng bucked the weakness closing up 0.5%. European indices are holding on to modest gains with energy, staples and retail outperforming. The FTSE 100 is outperforming up 0.5%. The government announced a new plan to help first time home buyers helping home builders.
ICE Brent is up ~2% but about $2 off the morning highs. US nat gas prices are down ~3% giving back some of last week’s gains. The precious metals complex is under significant pressure breaking below recent lows. Gold and silver are both decisively breaking below their respective 50d ma’s down 3% and 5%, respectively. Ag is also under pressure. Crypto has pulled back from overnight highs about where things left off on Friday.
Economic Data:
US:
- 10:30 Dallas Manufacturing
- 1:30 Fed Barkin
- China Industrial Profits: 15.7% y/y prior 17.6%
- India Industrial Production: 8% y.y vs.7.4% cons., prior 6.5%
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