To The Moon

If there is one word to sum up US stock market for week ending 11 Sep 2026, it would be “choppy”.

Aside from Mon, 07 Sep 2026 that was US Labour Day (public holiday), the market dipped for the next 3 trading sessions; only to surprise us on Friday when it staged a recovery of sort.

US market on Fri, 11 Sep 2026

By the time trading ended on Friday, (see above)

• Dow climbed +0.98% to 52,573.29.

• S&P 500 rose by +0.86% to 7,656.98.

• Nasdaq gain +0.96% to 26,333.04.

Weekly US market - Fri, 04 Sep to Fri, 11 Sep

If we take a step back and look at US market for the week,

• Dow dipped by -1.89% to 52,573.29.

• S&P 500 pullbacked by -1.20% to 7,656.98.

• Nasdaq fell by -0.96% to 26,333.04.

Key Catalysts.

US markets experienced a volatile week driven by (a) shifting oil prices and (b) rising inflation worries linked to Middle East tensions.

Crude prices spiked early in the week before tumbling late, which helped major stock indexes rebound on Friday.

The August Consumer Price Index (CPI) report matched most expectations, calming immediate market panic.

Strong economic data also strengthened investor focus on the upcoming Fed’s FOMC meeting (Sep 15-16) and potential rate hikes.

Despite the late-week recovery, all 3 major indexes still closed the week with overall losses.

Weekly US Economic Reports.

The ‘few’ reports that may have shaped market’s view for the week included:

• Thu, 10 Sep 2026 - US Jobless claims.

• Thu, 10 Sep 2026 - US Producer Price index (PPI) for August 2026.

• Fri, 11 Sep 2026 - US Consumer Sentiments (preliminary) for September 2026.

• Fri, 11 Sep 2026 - US Consumer Price index (CPI) for August 2026.

US Jobless Claims.

Latest weekly reports still present a strong labour market profile, with a low-layoff and historically resilient employment landscape.

Both metrics edged lower and comfortably beat or aligned with expectations, signaling that companies are holding onto their staff despite a broader "slow-hire, slow-fire" post-summer trend.

Weekly claims.

For week ending 05 Sep 2026, weekly claims decreased by -1,000 to 206,000 - from previous week’s upwards revised 207,000 and roughly in line with the 205,000 consensus estimate. (see below)

The 4-Week Moving Average also declined by -1,500 to 206,000 from previous week’s revised average of 207,500.

For the week, it is a strong report with weekly claims continue to hover within a tight, sub-215k range.

It underscores that layoffs are far, few & in-between and corporate workforce reductions remain minimal.

Continuing claims.

For week ending 29 Aug 2026, Continuing claims slipped by -1,000 to 1.774 million, coming in stronger than forecast of 1,780 million and marginally lower than previous week’s upwards revised 1.775 million.

The 4-week moving average also dipped by -1,750 to 1.779 million, down from a revised 1.78075 million.

Similarly, this week’s continuing claims report is a strong one.

While broader monthly data indicates that workers face slightly prolonged job searches once unemployed, the dip in total outstanding claims indicates that the aggregate pool of individuals collecting ongoing benefits is contracting rather than building up.

Producer Price Index (PPI).

For August 2026, the data revealed an acceleration in wholesale energy-driven costs alongside a cooling in underlying core pressures.

Headline PPI.

(1) Month-over-Month (MoM).

• Headline wholesale prices rose +0.4%, matching consensus estimates but marking a notable pickup from July 2026's revised +0.1%.

• According to Reuters, the primary culprit behind the surge was a massive +1.1% spike in goods prices, heavily driven by a +4.2% jump in energy costs.

• Specifically, a +24.1% explosion in wholesale diesel prices, alongside rising gasoline and jet fuel costs, accounted for a significant portion of the increase.

(2) Year-over-Year (YoY).

• On an annual basis, headline inflation accelerated to 5.4%.

• This came in slightly hotter than the 5.3% market forecast and is a visible step up from July 2026’s 4.8%.

• Ongoing renewed hostilities with Iran is pushing oil toward $105 a barrel and resulting in an intense, persistent pipeline cost environment.

Core PPI.

(3) Month-over-Month (MoM).

• Excluding volatile food & energy components, MoM’s Core PPI increased by +0.2%, offering a minor reprieve and cooler than the 0.3% expected and down from July 2026's +0.3%.

• The stabilization indicates that despite fierce input commodity shocks, broader demand-driven inflation isn't entirely spiraling.

• Service costs rose only a marginal +0.1%, while lower retail trade margins at -0.2% hint that corporations are absorbing some supply-chain stresses rather than immediately offloading them onto consumers.

(4) Year-over-Year (YoY)

• Opposite to the soft MoM data, the annual Core PPI rate accelerated to +4.6%.

• While it matches market consensus, it is up from July 2026’s 4.3%.

• This marks the highest core reading since early summer.

• More importantly, it signals that previous months of high upstream costs are still filtering through the economic architecture, keeping core measures sticky.

The reports are “bad” news for US economy:

• Headline metrics are undeniably hot, with both monthly & annual readings proved that supply-side inflation is far from defeated.

• These intense input price hikes will trickle down to consumer-facing prices.

• The data implies significant pressure on US Fed to consider keeping interest rates restrictive or executing another rate hike

• The report avoids being an absolute disaster because MoM Core rate (0.2%) printed soft.

• Had the MoM core numbers also overshot expectations, market narrative would be far more severe.

Overall, these reports reflect a robust inflationary trend in the US economy, with energy prices being a significant factor in this increase.

Consumer Sentiments.

The September 2026’s preliminary US Consumer Sentiment index is decidedly a weak report.

The main index dropped to 47.8 from August 2026's final reading of 51.7, missing the consensus forecast of 51.0.

It marks the 2nd consecutive monthly decline, placing US consumer sentiment near historic lows.

To be very specific:

• It is -16% below February 2026’s final readings of 56.6, before the onslaught of the Iran conflict.

• It is down -13%, compared to the same period last year.

Drilling down further, the deterioration is evident across both (a) current assessments (conditions) and (b) forward-looking economic gauges (expectations). (see above)

• Current economic conditions dropped to 50.9 from August 2026's 51.9. This reveals immediate, ongoing pressure on everyday household budgets.

• Consumer expectations index meanwhile, plunged to 45.8 from August 2026's 51.5, showing that consumers are heavily discounting the prospect of a near-term economic recovery.

Additionally,

• One-Year inflation expectations spiked to 4.6% from 4.0% in August, hitting its highest mark since June.

• Five-Year Inflation Expectations ticked up by +0.1% to 3.4% from 3.3%, indicating that long-term inflation fears are also beginning to become unanchored from historical baselines.

In summary, this is a highly weak & very concerning report.

If the preliminary readings hold, it will stand as the 2nd lowest reading in the history of the survey.

And it comes dangerously close to the historic nadir of 44.8 recorded in May 2026.

The combination of (1) plunging forward-looking confidence and (b) spiking inflation expectations creates a textbook portrait of a highly stressed US consumer.

Consumer Price Index (CPI).

US’s August 2026 CPI report showed a reacceleration of inflationary pressures.

Inflation matched projections due to surging fuel costs and a hotter-than-expected core monthly print has significantly increased the likelihood of a Fed’s interest rate hike.

Headline inflation.

(1) Month-over-Month (MoM).

• Expanded by +0.4%, marking the fastest monthly increase in 3 months. Over ⅓ of the surge was directly caused by gasoline prices, that rose by +3.9% over the month.

(2) Year-over-Year (YoY).

• On a YoY basis, headline CPI held steady at +3.4%, inline with both analysts’ estimates and last month’s readings reports.

• This reveals that broader inflation is "stalling” out rather than continuing its downward path toward the Fed's 2% target.

• Geopolitical shocks, including escalating global oil anxieties, continue to prop up the cost of everyday commodities.

Core inflation.

(3) Month-over-Month (MoM).

• Excluding volatile food & energy, monthly core CPI rose +0.3%, beating +0.2% consensus forecast and July 2026’s +0.2%.

• The sticky underlying domestic demand is still driving up prices.

• Significant push came from sectors like airline fares (+2.7%), shelter (+0.3%), and communication (+2.3%).

(4) Year-over-Year (YoY).

• Thankfully, on a YoY basis, core CPI moderated slightly to 2.4%, inline with market consensus and just a tad lower than July 2026’s 2.5%.

• This is technically the lowest annual core data since March 2021.

• Unfortunately, the MoM bump overshadows this deceleration and highlighted entrenched core service pressures.

The US economy remains trapped in a stagflationary tug-of-war, as supply-side energy shocks and stubborn domestic service fees clash with fading consumer confidence.

The persistent inflationary momentum has shattered hopes for a smooth economic landing, forcing households to absorb higher living costs while fracturing their purchasing power.

All these have caused US Federal Reserve to be backed into a corner, heavily raising the likelihood of imminent interest rate hikes that risk breaking an already fatigued consumer base.

CME Fedwatch Tool.

The latest CME FedWatch reading shows an 87.3% probability that US central bank will raise its target range by 25 basis points, from 350–375 bps to 375–400 bps, leaving only a 12.7% chance of no change.

All this will happen at the FOMC meeting on 16 Sep 2026.

Its a clear shift toward tightening expectations, with recent inflation data and energy-price pressures likely reinforcing concerns that inflation remains too persistent for the Fed to ease policy.

The expected hike could support the US dollar and Treasury yields while increasing pressure on rate-sensitive equities.

That said, markets may focus even more closely on the Fed’s statement, projections and guidance for future moves.

Question ?

Ahead of the likely interest rate hike, US market sentiment may remain cautious, with investors favouring defensive assets over rate-sensitive stocks.

The key risk is whether the Fed will signal further tightening as consumer confidence weakens.

Will its decision calm inflation fears or deepen concerns about an economic slowdown ? Will you adjust your investment strategy ?

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