What drove US macro and markets in the last 24 hours

Trading over the past day centered on the same cross-currents that have defined the month: the path of inflation and growth, the trajectory of interest rates, and a heavy run of corporate earnings that continues to reshape sector leadership. Positioning into month-end was also in focus, with investors rebalancing risk exposures after a volatile stretch in rates and equities.

Equities: earnings, guidance, and rotations

Corporate results remained the primary catalyst at the single-stock level. Investors rewarded companies that paired top-line resilience with margin discipline and clear full-year guidance, while punishing names showing demand cracks or elevated cost pressure. Balance-sheet strength, free-cash-flow durability, and visibility into 2026 capex plans were high on the checklist for large caps. On the factor side, quality and profitability screens stayed in demand, though there was intermittent interest in cyclicals tied to industrial activity and travel where bookings and backlogs looked firm.

Within mega-cap technology, the earnings narrative continued to bifurcate between firms levered to AI infrastructure build-outs and those leaning on ad-driven or discretionary consumer demand; both capex intensity and monetization timelines remained under close scrutiny. Health care saw defensive interest around predictable cash flows and pipelines, while financials traded on trends in net interest income, fee revenue, credit normalization, and capital return plans.

Rates: term premium and growth-inflation mix

Treasury volatility stayed elevated, particularly at the long end where term premium and supply expectations are key drivers. Traders weighed the balance between cooling-inflation progress and pockets of demand resilience, with moves often amplified by systematic positioning and hedging around key data. The curve’s shape continued to reflect a late-cycle debate: how quickly policy normalizes versus how persistent nominal growth proves into year-end.

Dollar and commodities

The US dollar’s intraday swings were tethered to rate differentials and risk appetite. A firmer dollar remained a headwind for multinational earnings translation and parts of the commodity complex, while any dollar softness offered relief to import-sensitive sectors. In energy, crude prices responded to evolving geopolitical risk and inventory signals; refined products and transport costs remained part of the inflation-watch mosaic. Industrial metals traded as a proxy for global manufacturing momentum and green-capex demand.

Credit and funding

Credit markets were orderly, with investors differentiating more by issuer quality and maturity profile than by broad risk-on/off shifts. Primary issuance stayed opportunistic into month-end, and spreads continued to price a benign default backdrop in investment grade while embedding more dispersion in high yield. In money markets, front-end rates reflected expectations for the policy path and abundant collateral dynamics.

Macro data and market psychology

While the headline calendar ebbs and flows, the market’s focus did not: inflation trend versus target, labor-market cooling without a sharp deterioration, and the sustainability of real growth. Against that backdrop, intraday tone shifts tracked incremental data points, earnings calls, and moves in the 10-year yield—each feeding into the broader debate on how restrictive financial conditions need to stay.

Positioning and flows into month-end

Rebalancing considerations were a quiet but important undercurrent. After sizable swings across equities, rates, and the dollar this month, model-driven and discretionary portfolios adjusted exposures, which can add technical noise to late-week price action. Buyback activity and earnings-related blackout windows also influenced liquidity and single-name dynamics. Options flows around widely watched strike levels continued to modulate intraday volatility.

The 7-day outlook: catalysts, scenarios, and what to watch

Key macro catalysts on deck

  • Inflation: The monthly Personal Consumption Expenditures (PCE) report—particularly core measures and services ex-housing—will be scrutinized for evidence that disinflation is either broadening or stalling.
  • Growth: The advance estimate of quarterly GDP and associated components (consumption, inventories, residential investment) will shape narratives about momentum heading into year-end.
  • Labor: Weekly initial jobless claims will provide a timelier read on labor-market cooling; revisions and continuing claims trends matter for wage and consumption outlooks.
  • Sentiment and activity: Consumer confidence and regional manufacturing surveys will offer a check on spending intentions, pricing power, and order books.
  • Treasury financing: The Treasury’s near-term borrowing expectations and upcoming coupon auction schedule will influence duration supply assumptions and term premium.
  • Earnings: Another dense wave of corporate reports, including large-cap bellwethers across tech, industrials, consumer, energy, and health care, will drive sector dispersion and broader risk tone.

Market scenarios to consider

  • Hotter inflation, resilient growth: Upside inflation surprises alongside firm activity data would likely pressure the long end of the curve and support the dollar, challenging rate-sensitive equities and richly valued growth shares while favoring cash-generative defensives.
  • Cooler inflation, steady growth: A benign combination would typically ease yields and support risk assets broadly, with cyclicals and small caps benefiting if rate relief is seen as durable.
  • Softer growth, cooler inflation: A growth scare paired with softer prices could flatten curves as markets price more policy normalization; defensives and high-quality credit would tend to outperform while cyclicals lag.
  • Softer growth, sticky inflation: The least favorable mix for duration and equities, usually adding to volatility and rewarding balance-sheet strength and shorter-duration credit exposures.

Sector and asset-class watchlist

  • Technology and communications: Watch AI-related capex outlooks versus near-term monetization, cloud growth deceleration or reacceleration, and commentary on enterprise budgets.
  • Financials: Net interest margin trends, deposit mix stability, credit normalization in cards and auto, commercial real estate exposures, and capital return plans.
  • Consumer: Evidence of bifurcation between higher- and lower-income cohorts; promotions, inventory levels, and elasticity in discretionary categories.
  • Industrials and materials: Order backlogs, pricing versus input costs, and signals on reshoring, infrastructure, and energy-transition demand.
  • Energy: Supply discipline, free cash flow allocation, and sensitivity to spot and forward curves.
  • Housing: Mortgage-rate sensitivity, builder incentives, and any shift in new versus existing home dynamics feeding into shelter inflation.
  • Credit: High-yield and leveraged-loan spreads for early stress signals; investment-grade primary calendar for risk appetite and pricing power.

Technical and positioning considerations

  • Month-end flows: Potential rebalancing effects in both equities and fixed income can add non-fundamental moves, especially into the final trading sessions of the month.
  • Volatility: Keep an eye on implied versus realized volatility across equities and rates; crowded positioning can amplify moves around data drops and earnings.
  • Breadth and leadership: Market health often hinges on participation; watch whether advances broaden beyond a handful of large caps and whether defensives or cyclicals lead on up/down days.

Risks to monitor

  • Geopolitical developments that could alter energy prices or global risk appetite.
  • Unexpected shifts in Treasury issuance needs or auction demand that impact the term premium.
  • Corporate guidance resets that change the earnings trajectory for 4Q and early 2026.
  • Liquidity air pockets around major data releases and large options expiries.

Bottom line

The near-term market path remains highly sensitive to incremental evidence on inflation’s descent and growth’s durability, filtered through the lens of interest-rate expectations and supply dynamics in the Treasury market. With month-end technicals and a dense slate of macro releases and earnings ahead, expect movement to be headline-driven and dispersion to remain elevated across sectors and factors.