STRAIGHT FROM THE TRADING FLOOR
by Eric Criscuolo - Market Strategist
Published on 8/26/26 (a/o 1:30 pm)
DOW 53,475 (-102), S&P 500 7,675 (-2), Russell 2000 3,004 (-6), NYSE FANG+ 18,356 (+11), ICE Brent Crude $88.43/barrel (-$0.15), Gold $4,652/oz (-$42), Bitcoin ~78.6k (+18)
MAC Desk Commentary:
Yesterday early morning news of growing optimism from Pakistan on talks with Iran helped push oil and yields lower, providing a tailwind for equities. Later in the day, reports of an emerging agreement between Iran and Oman for a temporary shipping route through the Strait of Hormuz added to those moves. That helped mitigate deteriorating US-Canada trade relations (aka Loonie Toons). Equity gains were modest, however. Despite crude falling 4% the S&P 500 rose only 0.3% and the equal-weight had a slight loss. The Russell 2000 outperformed, gaining 0.5%. Yields fell ~5bp across the curve. Tech and the AI trade led, bouncing after declines on Monday (DRAM +4%, ICE Semis +2%). Energy, Staples, and Industrials were the only sectors lower. A nasty decline in Dicks Sporting on earnings took retailers down across the segment.

A quiet start to the week was punctuated this morning with a slew of economic data, headlined by PCE. Core PCE (0.2% m.m, 3.3% y.y) was on the screws while the headline was a bit hotter than expectations (0.2% / 3.7% vs 0.1% / 3.6%). The increase was driven entirely by Services. Goods prices fell 0.1% versus June, led gas and other energy goods falling, which added on to last month’s 0.6% decline. Furniture and household items also fell.  Motor Vehicles/parts rose versus last month as did Other durable goods. Services rose 0.3%, up from last month’s 0.1% rise. A big part of that was Financial Services and insurance, which moves with financial markets. Transportation services moderated from last month. 
Personal Spending rose 0.2% versus last month and was generally inline. However spending growth has declined since May, real spending was essentially flat and most of this month’s spending increase was from Financial Services and Healthcare, while spending on goods declined broadly. 
Durable Goods rose 1.1% from last month, beating estimates and increasing from the last report. However ex-defense and aircraft (i.e. capital goods orders) was weaker, up only 0.2% versus 0.9% consensus and down from 1.7% last month (revised up from 0.9%). Overall, inflation remains elevated, though contained. Consumer Spending continues to hold up but is maybe not as robust as before. Market pricing of the Fed holding rates steady in September remains at 60%, unchanged from yesterday. 

Ahead of the data S&P futures traded flat for most of the overnight session. Futures rose modestly right after the prints but then pulled back and the S&P opened slightly lower. We returned to unchanged and have bounced around there since. Once again we're trading in a tight range. The equal-weight index is outperforming slightly, modestly in the green while the Russell 2000 is lagging slightly.
Oil continued to fall this morning, with reports that Iran reached a revenue sharing deal with Oman on the Strait, though that looks to still be in discussion.  The NYT reported that US diplomats that were evacuated from the Middle East at the start of the Iran war will be returning, while other reports said Secretary of State Rubio has been telling counterparts the US is focusing on economic versus military actions against Iran, at least temporarily. However after the open Vladimir Putin said talks with Ukraine were fruitless and Rusia is preparing to escalate militarily. Crude bounced off its lows and regained and is back into positive territory.

Crude’s reversal has made Energy a leading sector today. Industrial are also leading. Defense contracts are up modestly, as are freight/transport names and construction/electrical names are bouncing from weakness earlier this week. Utilities round out the modest leaders today, despite yields backing up (IPPs are trading relatively well).

On the downside are Comm Services (GOOG -2% but sector broadly weaker), Consumer Discretionary (retail getting hit again, AMZN -1%) and Healthcare (biopharma giving back some recent gains and BSX hit with a cybersecurity breach).  Meta is trading up 1% after reaching an agreement to settle claims related to the addiction and data collection of its platform. The agreement includes $18B, payable over 10 years. The settlement is partially depended on Alphabet’s YouTube and TickTok making similar changes to the apps that Meta will undertake, driving the pressure on GOOG today. 
Among earnings names, INTU was down 10% in the pre-market but has cut that loss in more than half, currently down 4%.  While the print and guide are messy as stock-based comp gets included into the numbers, the overall concern of AI-disruption remains. ZM has held onto its ~5% decline, however. Analog semi manufacturer SMTC is up 8%. Retailer  ANF has added to early gains, up over 30% while noting “accelerating momentum in the Americas and improving trends in EMEA.” SJM is up 4% after its beat-and-raise. This leads into tonight’s earnings main event: NVDA. Salesforce, HP and CrowdStrike will also be providing important earnings updates, among several others. Speaking of NVDA, Anthropic will lease an Nscale data center in West Virginia for $46B, according the Bloomberg. The facility will use Nvidia chips, and all in costs for Nscale to develop the full site are estimated at $71B. Neoclouds are lower.

Treasury yields were weakening into the prints this morning but then reversed the move and continued to climb, pushed higher by the reversal in oil. The 5y treasury auction this afternoon tailed by 0.2bp. The Dollar has followed rates higher.

  • US 2yr +3bps to 4.23%, 5yr +4bps to 4.38%, 10yr +3bps to 4.66%, 30yr +2bps to 5.18%
  • USD index: +$0.28 to $99.12.
We noted Brent crude's moves today. The Oct contract trying to hold its 100d ma ~$86.25. That was before Putin’s comments pushed crude higher. Despite those words European natural gas is down about 3%. US natural gas is up 4% as the September contract expires tomorrow.  Metals are lower, moving to their lows as yields backed up after today’s data. Gold is consolidating after its recent run to $4700. Bitcoin and Ether also continue to consolidate after their sprints higher. The ag complex has accelerated to the upside on Putin’s comments (Wheat +5%). 
Major European indicies ended around unchanged, fading towards the end of their session. Germany’s DAX retreated after failing to break through resistance around its ATH ~26,500. Miners, Industrials, consumer/luxury and financials led while Energy and Tech lagged. Japan’s Nikkei closed higher overnight. The upcoming speech by BOJ Deputy Governor Himino tomorrow is gaining more attention as it comes before the BOJ’s September meeting as well as this week’s Jackson Hole symposium. Market expectations for a rate hike have eclipsed 80%, while July Services PPI came in ahead of expectations and rose from June. In China, Shanghai and Hong Kong were higher. According to the FT, in its pre-IPO presentations, China’s YMTC laid out a plan to become the world’s biggest NAND memory producer by YE 2027, supplanting Korean giants Samsung and SK Hynix. Australian equities fell after a hotter than expected CPI print raised expectations for another rate hike. The Bank of Korea is narrowly expected to hike rates 25bp tomorrow.
Earnings:
  • After-Market: A, CRWD, HP, NTNX, NVDA, OKTA, OOMA, P, CRM, SNPS, URBN, VEEV
  • Pre-Market (Thrs): BBY, BBW, BURL, DG, DLTR, HRL, PURR, RY, TD
  • After-Market (Thrs): AFRM, ADSK, GAP, IREN, MRVL, PD, RBRK, S, ULTA, WDAY

Economic Data:
US:
  • July PCE m.m / y.y: 0.2% / 3.7% vs 0.1% / 3.6% cons, prior -0.1% / 3.7%
  • Core PCE: 0.2% / 3.3% vs 0.2% / 3.3% cons, prior 0.1% / 3.3%
  • 2Q GDP 2nd estimate: 1.5% vs 1.5% initial estimate    
  • Personal Income / Spending m.m: 0.4% / 0.2% vs 0.2% / 0.1% cons, prior 0.2% / 0.3%
  • Durable Goods Orders m.m: 1.1% vs 0.5% cons, prior 0.3%
  • Ex-transports: 0.4% vs 0.6% cons, prior 1.1%, revised up from 0.6%
  • Ex-defense, ex-aircraft: 0.2% vs 0.9% cons, prior 1.7% revised up from 0.9%
  • Mortgage apps: -0.3% vs prior -2.0%
  • Refis: -2.0% vs prior +1.5%
  • 30y rate: 6.78% vs prior 6.77%
  • EIA Crude inventories: 0.095M vs 0.6M cons, prior 4.405M
  • API Oil Inventories (Tues AMC): 4.2M vs 1.8M cons, prior -0.328M
Global:
  • Japan Services PPI y.y: 3.6% vs 3.2% cons, prior 3.4%
  • Australia July CPI m.m / y.y: 1.0% / 3.5% vs 0.8% / 3.3% cons, prior -0.1% / 3.8%
STRAIGHT FROM THE TRADING FLOOR
by Eric Criscuolo - Market Strategist
Published on 8/26/26 (a/o 9:00 am)
Good morning,
 
Yesterday early morning news of growing optimism from Pakistan on talks with Iran helped push oil and yields lower, providing a tailwind for equities. Later in the day, reports of an emerging agreement between Iran and Oman for a temporary shipping route through the Strait of Hormuz added to those moves. That helped mitigate deteriorating US-Canada trade relations (aka Loonie Toons). Equity gains were modest, however. Despite crude falling 4% the S&P 500 rose only 0.3% and the equal-weight had a slight loss. The Russell 2000 outperformed, gaining 0.5%. Yields fell ~5bp across the curve. Tech and the AI trade led, bouncing after declines on Monday (DRAM +4%, ICE Semis +2%). Energy, Staples, and Industrials were the only sectors lower. A nasty decline in Dicks Sporting on earnings took retailers down across the segment.
 
A quiet start to the week gets punctuated this morning with PCE data, along with revised GDP, Income/Spending and Durable goods ahead of the Open. S&P futures traded flat for most of the overnight session. Core PCE was on the screws while the headline was a bit hotter than expectations. Futures rose modestly right after the print but have retreated and are now slightly lower. Oil continues to fall while precious metals weakened as yields rose. There were reports that Iran reached a revenue sharing deal with Oman on the Strait, though that looks to still be in discussion.  The NYT reported that US diplomats that were evacuated from the Middle East at the start of the Iran war will be returning.
 

 
The GDP 2nd estimate was unchanged from the initial estimate, at 1.5%. Consumer spending, which drove the growth, was nudged higher, offset by an higher revision for Imports. Personal Income and Spending were higher than expected. Treasury yields were weakening into the prints but then reversed the move and are now up ~2bp from yesterday, despite oil’s slide. The US Dollar Index is higher.
 
  • US 2yr +2bps to 4.21%, 5yr +3bps to 4.37%, 10yr +2bps to 4.65%, 30yr +1bps to 5.18%
  • USD index: +$0.18 to $99.02
This leads into tonight’s NVDA earnings, along with Salesforce.  Speaking of earnings, INTU is down 10% in the pre-market after reporting results. While the print and guide are messy as stock-based comp gets included into the numbers, the overall concern of AI-disruption remains. ZM is also down 5% after its earnings. Analog semi manufacturer SMTC is around unchanged. On the other hand, retailer ANF is up over 10% on its earnings while noting “accelerating momentum in the Americas and improving trends in EMEA.” SJM is up 5% after its beat-and-raise.
 
Brent crude continues to fall this morning. The Oct contract is trying to hold its 100d ma. European natural gas is down about 4% as prospects for a normalized Strait transit improve. Gold is slightly lower, consolidating after its recent run toward $4700, while other precious metals are modestly higher. Bitcoin and Ether also continue to consolidate after their sprints higher and ag is trading higher as well.
 

 
Major European indicies are trading higher, at their best levels. Miners, consumer/luxury and financials are leading while Energy and Tech lag. Japan’s Nikkei closed higher overnight. The upcoming speech by BOJ Deputy Governor Himino tomorrow is gaining more attention as it comes before the BOJ’s September meeting as well as this week’s Jackson Hole symposium. Market expectations for a rate hike have eclipsed 80%, while July Services PPI came in ahead of expectations and rose from June. In China, Shanghai and Hong Kong were higher. According to the FT, in its pre-IPO presentations, China’s YMTC laid out a plan to become the world’s biggest NAND memory producer by YE 2027, supplanting Korean giants Samsung and SK Hynix. Australian equities fell after a hotter than expected CPI print raised expectations for another rate hike. The Bank of Korea is narrowly expected to hike rates 25bp tomorrow.
 

 
Earnings
After-Market (Tues): BOX, HEI, INTU, SMTC, ZM
Pre-Market: ANF, BBWI, DCI, DY, SJM, KSS, MOV, WSM
After-Market: A, CRWD, HP, NTNX, NVDA, OKTA, OOMA, P, CRM, SNPS, URBN, VEEV
 
Economic Data:
US:
  • July PCE m.m / y.y: 3.7% / 0.2% vs 0.1% / 3.6% cons, prior -0.1% / 3.7%
    • Core PCE: 0.2% / 3.3% vs 0.2% / 3.3% cons, prior 0.1% / 3.3%
  • 2Q GDP 2nd estimate: 1.5% vs 1.5% initial estimate    
  • Personal Income / Spending m.m: 0.4% / 0.2% vs 0.2% / 0.1% cons, prior 0.2% / 0.3%
  • Durable Goods Orders m.m: 1.1% vs 0.5% cons, prior 0.3%
    • Ex-transports: 0.4% vs 0.6% cons, prior 1.1%, revised up from 0.6%
    • Ex-defense, ex-aircraft: 0.2% vs 0.9% cons, prior 1.7% revised up from 0.9%
  • Mortgage apps: -0.3% vs prior -2.0%
    • Refis: -2.0% vs prior +1.5%
    • 30y rate: 6.78% vs prior 6.77%
  • API Oil Inventories (Tues AMC): 4.2M vs 1.8M cons, prior -0.328M
  • Mortgage apps: -0.3% vs prior -2.0%
  • 10:30am EIA Crude inventories
  • 11:45am Fed Barkin speech
  • 1:00pm 5y auction
Global:
  • Japan Services PPI y.y: 3.6% vs 3.2% cons, prior 3.4%
  • Australia July CPI m.m / y.y: 1.0% / 3.5% vs 0.8% / 3.3% cons, prior -0.1% / 3.8%

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