Week commencing September 28th 2026
TradeDay Macro Matters
Macroeconomic / Geopolitical developments
- US stock averages end choppy week higher
- Strong US Flash PMI data stokes inflationary fears
- Inflationary worries and poor UST 5 year auction sends bond yields higher
- Meta Muse AI agent demand stokes AI trade
- US Employment report and PCE inflation data in focus this week
- What's Ahead
US stock averages end choppy week higher
US stocks finished the week higher despite a choppy trading environment, with the Nasdaq Composite rising 2.1%, the S&P 500 gaining 1.2% and the Dow Jones Industrial Average adding 0.3%. The Dow snapped a three week losing streak, while the S&P 500 ended its two week decline and the Nasdaq reached a fresh record during the week, before easing slightly.
Technology led the market, rising 3.1%, while healthcare gained 1.57% and growth stocks outperformed value as investors continued to favour areas of the market linked to the AI theme. Energy and utilities were the weakest sectors, falling 3.07% and 3.04% respectively, while large cap stocks gained 1.25% compared with almost flat performance from mid and small caps.
Strong US Flash PMI data stokes inflationary fears
US business activity accelerated sharply in September, with the S&P Global Flash Composite PMI rising to 58.4 from 56.0 in August, its highest level in more than five years. Services activity increased to 58.7, while manufacturing PMI climbed to 57.0, with stronger new orders, rising backlogs and faster employment growth pointing to continued momentum across the private sector.
The strength of the data also highlighted renewed price pressures, with average input costs for goods and services increasing at their fastest pace since October 2022. Higher fuel and transportation costs were a significant factor, while wage pressures also picked up, raising concerns that resilient economic growth could make it harder for inflation to return sustainably toward the Federal Reserve’s target.
Inflationary worries and poor UST 5 year auction sends bond yields higher
US Treasury yields moved sharply higher during the week as stronger economic activity and renewed inflation concerns encouraged investors to reassess the outlook for interest rates. The 10 year yield briefly climbed above 5.20% before ending the week around 5.16%, up from 5.01%, while the 30 year yield approached 5.5% and the 2 year yield reached 4.85%.
The bond sell off was reinforced by weak demand at the US Treasury’s five year auction, which priced at a 5.033% clearing yield, the highest since 2006 and more than three basis points above expectations. A $44 billion seven year Treasury auction the following day also required a higher yield than where the bonds had been trading beforehand, adding to concerns about demand for government debt and pushing borrowing costs higher across markets.
Meta Muse AI agent demand stokes AI trade
The AI trade received fresh momentum from strong early demand for Meta’s Muse personal AI agent, which quickly climbed to the top of Apple’s App Store and helped drive a sharp recovery in Meta shares. The stock has risen around 19% since Muse launched on September 8, as investors increasingly consider whether consumer focused AI agents could create a new source of revenue beyond traditional digital advertising.
Meta is positioning Muse as the centre of a wider AI ecosystem that could extend into smart glasses and other hardware, with the company also offering paid versions of the service. The renewed enthusiasm has helped shift investor attention from concerns about Meta’s large AI capital spending plans toward the potential commercial opportunities created by agentic AI, although converting rapid user adoption into sustainable revenue remains an important test.
US Employment report and PCE inflation data in focus this week
The US economic calendar will be dominated by the August PCE inflation report on Wednesday and the September Employment report on Friday, with both releases likely to influence expectations for the Federal Reserve’s next policy move. Headline PCE is expected to rise 0.4% month over month, while core PCE is forecast to increase 0.3%, following annual rates of 3.7% and 3.3% respectively in July.
The Employment report will show whether August’s stronger performance continued into September, after payrolls increased by 162,000 and unemployment remained at 4.1% in August. Markets expect September payroll growth of around 100,000 and unemployment of 4.2%, while JOLTS job openings, ADP employment, ISM manufacturing and Micron’s earnings will provide additional clues about the health of the economy and the strength of AI related investment.
What's Ahead
Central Bank Watch: The main central bank activity this week is Tuesday’s Reserve Bank of Australia Monetary Policy Statement, Interest Rate Decision and Press Conference on.
Macro Data Watch: The main macro data releases this week are the US PCE inflation data on Wednesday and US Employment report on Friday. Some other releases of note are UK GDP on Wednesday, Global Manufacturing PMI on Thursday and EU HICP on Friday.
Date
Major Macro Data
09/28/2026
BoJ Monetary Policy Meeting Minutes
09/29/2026
RBA Monetary Policy Statement, Interest Rate Decision and Press Conference; EU Business Climate, Consumer Confidence and Economic Sentiment Indicator; Canadian GDP; US Housing Price Index, Consumer Confidence and JOLTS Job Openings
09/30/2026
Chinese PMI; German Retail Sales, Unemployment Rate and CPI; UK GDP; US PCE and ADP Employment Change, GDP, Personal Income and Personal Spending
10/01/2026
Global Manufacturing PMI; US Initial Jobless Claims and Challenger Job Cuts
10/02/2026
Japanese CPI and Unemployment Rate; EU HICP and Unemployment Rate; US Employment Report
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