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Monday saw the release of the ISM Services PMI.  It came in at 54.9, which suggests that the service sector is doing quite well. Services spending has been among the pillars of the economy since 2020 and has long been considered one of the key drivers of inflation. However, such spending has also minimized the risk of a recession during periods of relatively higher interest rates.

On Wednesday afternoon, the FOMC released the minutes from the September meeting. As expected, there was little drama or controversy surrounding the rate hike that occurred at that meeting. Furthermore, the minutes revealed that there is little disagreement over the need for another hike. However, there is some discussion as to when that hike should take place and what the criteria would be to follow through on it.

Thursday morning, unemployment claims data for the previous seven days was released. During that period, there were 197,000 claims, which matched the total from last week. On Friday, the University of Michigan released its consumer sentiment and inflation expectation reports. Consumer sentiment came in at 46.3 compared to an expected 47.5.

Inflation is expected to be at 4.7 percent 12 months from now. If true, that would represent a significant increase from today’s level of about 3.4 percent on an annualized basis. Next week, the CPI report for September is due out, and analysts believe that inflation has risen to 3.6 percent on an annualized basis.

The S&P 500 was up 1 percent this week to close Friday’s trading at 7,811. This was a gain of 77 points over the last five trading days. Over the past month, the index is up 1.75 percent. This week, the index made a low of 7.735 early Monday morning and made a high of 7,842 on Tuesday afternoon.

The Dow was up 1.58 percent to finish the week at 51,654. This was a gain of just over 800 points for the index. Despite the strong performance over the last five days, it is still down 1.89 percent over the past month. For the week, the index made a low of 50,916 on the open of Monday’s session and a high of 51,753 just prior to the close on Friday.

Finally, the Nasdaq was flat this week, losing four points to close at 27,366. This was a loss of .01 percent over the last five trading days. The index is up 3.72 percent over the last month. This week, the Nasdaq made a high of 27,716 on Tuesday and a low of 27,094 on Thursday afternoon.

In international news, Canada announced Friday that its economy lost 68,000 jobs in September. This was compared to a projected gain of about 4,000 prior to the release. It was also announced that Canada’s unemployment rate increased to 6.5 percent from 6.4 percent in August. On Tuesday, the head of the Bank of Japan (BOJ) said that the nation may raise its key interest rate later in October. Despite this, he claims that monetary policy in the country remains conducive to economic growth.

This week should be another interesting one for market participants. In addition to CPI data, retail sales and PPI for September as scheduled to be released on Thursday. Unemployment claims will also be released on Thursday, as well as the Philly Fed Manufacturing Index. Fed Chair Warsh is scheduled to speak late Thursday night at a meeting of the World Bank and International Monetary Fund in Bangkok.

On Tuesday, the CB Consumer Confidence report came in at 81.9 compared to an expected 89.2 prior to the release. The JOLTS report found that there were 7.08 million open positions in the United States, which was just under what analysts expected.

On Wednesday, the Core PCE Price Index for September was revealed that prices rose 0.2 percent during that period. This was a tick below the expected increase of 0.3 percent before the report came out. In addition, final GDP numbers for the second quarter of the year came out.

During that period, the economy grew 2.2 percent compared to an expected 1.5 percent. This gives more credence to Fed Chair Warsh’s assessment that the economy is poised to grow, which means that the Fed can focus on inflation as opposed to employment numbers. Interestingly, it was mentioned this week that there may not be a need for another rate hike in 2026. It was widely expected after September’s hike that at least one more would occur before the end of the calendar year.

Finally, Wednesday saw the release of the ADP’s version of the nonfarm payroll report. The economy added 90,000 jobs compared to an expected 76,000. However, the good news would be negated by a relatively sluggish report released by the Bureau of Labor Statistics (BLS) on Friday. 0

The report found that the economy added just 29,000 jobs in September compared to an expected 89,000. Furthermore, the August report was revised downward to 133,000 new jobs. In addition, average hourly earnings in September were up 0.1 percent compared to an expected increase of 0.3 percent. Finally, the unemployment rate ticked up to 4.2 percent compared to 4.1 percent last month.

In other news, unemployment claims remained steady with 197,000 requests for benefits over the last seven days. This was just 1,000 short of last week’s figure of 198,000.

The ISM Manufacturing PMI came in at 54.5, which shows that the sector is still in an expansion phase. The ISM Services PMI will be released on Monday.

The S&P 500 was up 0.24 percent to finish at 7,722, which was an increase of 18 points for the week. Over the last month, the index is up 0.67 percent. For the week, the market made a low of 7,625 on Thursday and a high of 7,750 on Friday.

The Dow was down 0.69 percent this week to close at 51,176. This was a loss of 353 points this week despite finishing Friday up more than 250 points. On Monday, the market made a weekly high of 51,176 and a weekly low of 50,616 on Thursday. The index is down 3.72 percent over the last month.

Finally, the Nasdaq was up 1.01 percent this week to close at 27,190. This was a gain of 270 points over the last five trading days for a market that is up 3.46 percent over the last month. The index made a weekly low of 26,743 on Monday and a weekly high of 27,309 on Friday.

In international news, Australia announced Tuesday that CPI was at 0.4 percent on a monthly basis in September and 4 percent on an annualized basis. This came a day after the Reserve Bank of Australia increased the country’s main interest rate to 4.6 percent from 4.35 percent. Canada announced on Tuesday that GDP growth was flat on a monthly basis, which was expected prior to the announcement.

This week will surely be consequential as the FOMC meeting minutes from September as set to be made public Wednesday afternoon. Unemployment claims data comes out on Thursday while the University of Michigan releases its consumer sentiment and inflation expectation data on Friday.

This was another consequential week as markets continued to digest the Fed’s decision to hike rates last Wednesday. Markets are also bracing for the prospect of more interest rate hikes before the end of the year.

Oil has engaged in choppy trade over the last month or so. The start of September saw the price of West Texas Intermediate (WTI) jump to about $102 a barrel. However, by the start of this week, it had dropped to about $90 a barrel before rising again to around $98 by midweek.

Bond markets made strong moves to the upside this week as the rate for the 10, 20 and 30-year Treasury bond breaching 5 percent. The two, three and five-year bonds are all at 4.8 percent or higher. This is important because mortgage rates are highly correlated with the 10-year bond. Therefore, as bond rates go higher, mortgage rates will as well.

The interest rate for a 30-year mortgage rose to 7.5 percent as a result. This will likely have a detrimental impact for buyers and sellers alike as higher rates mean buyers have less to spend, which can keep prices lower.

On Wednesday, the Flash Services PMI and Flash Manufacturing PMI came out. The Flash Services PMI came in at 58.7 while the Flash Manufacturing PMI came in at 57. This means that both sectors are experiencing growth, which should be solid news for the economy in the short-term. However, it can also have negative implications for inflation and stricter monetary policy.

Thursday, unemployment claims for the last seven days were made public. During that period, 197,000 people asked for benefits, which was just 1,000 fewer than last week and about 4,000 less than analysts predicted before the report was released.

Finally, Friday saw the release of the consumer sentiment and inflation expectation reports from the University of Michigan. Consumer sentiment came in at 48.1 while inflation is expected to be at 4.6 percent 12 months from now.

The S&P 500 was up 52 points this week to close at 7,743. This was a 0.68 percent increase since the beginning of trading Monday. The market is now up 1.15 percent over the past month. For the week, the index made a high of 7,777 on Tuesday and a low of 7,666 on Thursday.

The Dow was down 0.05 percent this week to close at 51,828. This was a loss of 24 points for a market that has struggled recently to sustain its momentum from earlier this year. It is down 3.05 percent over the last month but is still up 12.8 percent over the last 12 months. This week, the index made a high of 52,162 on Tuesday and a low of 51,127 on Thursday.

Finally, the Nasdaq was up 1.15 percent to finish the week at 27,068. This was an increase of 308 points for an index that has significantly outperformed the other two major indexes. For the week, the index made a high of 27,282 on Tuesday and a low of 26,707 on Thursday.

In international news, Australia announced on Wednesday that its economy gained 39,500 jobs over the last month. On Thursday morning, Switzerland announced that it would keep the nation’s key interest rate at 0 percent. Also on Thursday, Canada announced that retail sales dropped 0.7 percent in August.

The upcoming week should be another interesting one as several key news events are on the schedule. On Tuesday, the CB Consumer Confidence and JOLTS reports come out while the Core PCE Price Index and final GDP numbers for the second quarter come out Wednesday. The ADP and BLS nonfarm payroll reports for September come out Wednesday and Friday.