Stocks finished the week at record highs as investors digested the Federal Reserve’s interest rate cut and weighed the path ahead for policy.
In the week ahead, a raft of Fedspeak will highlight the calendar, with speeches from newly installed Federal Reserve board governor Stephen Miran and Fed Chair Jay Powell on Monday and Tuesday, respectively, the biggest events for close Fed-watchers.
Elsewhere on the calendar, a few major earnings reports and a smattering of economic data will populate the schedule as investors navigate the relative lull between earnings seasons.
A key economic highlight will be Friday’s update on inflation, with the Personal Consumption Expenditures index set to show that “core” PCE inflation, the Fed’s preferred measure, eased to 0.2% in August while annual increases remained at 2.9%, above the central bank’s target.
U.S. Federal Reserve Chair Jerome Powell attends a press conference in Washington, D.C., the United States, Sept. 17, 2025. (Photo by Hu Yousong/Xinhua via Getty Images) ·Xinhua News Agency via Getty Images
Investors will also keep an eye on the University of Michigan’s consumer sentiment index out Friday morning and also closely track mortgage rates, which are near their lowest levels in a year, according to Freddie Mac.
Attention on earnings this week will be focused on Micron Technology (MU), where investors will watch for updates on AI-driven demand and revenue guidance after a recent raise, and on Costco (COST), a stalwart measure of consumer spending patterns.
Firefly Aerospace (FLY), AutoZone (AZO), Cintas Corporation (CTAS), and Accenture (ACN) are also among the notable names expected to report results.
Investors were all but certain the Fed was going to cut rates last week.
They celebrated the move anyway.
On Thursday, the S&P 500, Nasdaq, Dow, and Russell 2,000 closed at record highs in unison for the first time since 2021. On Friday, the three major indexes — excluding the small-cap Russell 2000 (^RUT) — closed at another record.
With investors enthusiastic about not only the Fed’s rate cut this week, but also the path ahead for the central bank, stocks saw their largest weekly inflow since December, according to data from Bank of America.
Inflows to US stocks this week tallied $57.7 billion, while investors moved nearly $5 billion out of cash for the first weekly outflow since July, BofA said. Some investors and commentators may talk about fears of the stock market growing overheated; actions suggest otherwise.
And not only have investors gotten the rate cuts some clamored for, but trade risks have also subsided.
Tariffs on China remain on a 90-day pause until Nov. 10 as Trump continues to ease tensions with his counterpart in Beijing. Signals that an agreement on control of TikTok’s US operations looks set to be reached and suggestions that Presidents Trump and Xi will meet later this year in South Korea all eased worries about the US-China trade spat.
Senate Democrats and Republicans this week each blocked the other party’s proposals to extend government funding through the end of the month, which would’ve bought Congress more time to hash out a spending bill.
The Republicans’ bill, which passed the House virtually along party lines, would have funded the government through Nov. 21, but it failed to clear the 60-vote threshold in the Senate. A proposal from the Democrats, which also failed in the Senate, would have extended funding through Oct. 31, allocated more than $1 trillion to extend Obamacare subsidies due to expire at the end of the year, and rolled back cuts to Medicaid included in the One Big Beautiful Bill.
It’s been a strong year in global markets.
Stocks are rallying in the US and worldwide. Gold is at a record. Bitcoin is surging.
In the energy market, things have not been so kind.
Both Brent (BZ=F) crude oil, the global benchmark, and West Texas Intermediate (CL=F) crude prices fell over 1% on Friday. This year, both are down over 10%.
All else equal, lower borrowing costs and easier financial conditions might be expected to spark an increase in oil demand and, in turn, a rise in prices.
Initial indications don’t suggest the market will follow that pattern this year.
In a move that came widely as a surprise to the energy markets, the OPEC+ cartel agreed to raise production rates in October as Saudi Arabia chases a larger global market share. Higher output has also stoked fears of continued price pressure in the oil markets. The cartel has been raising production since April despite projections that supply is steadily outstripping demand.
This is also a Fed story, in part. But unlike the stock market, the oil story is not a Fed story that has worked so far.
Oil is dollar-denominated worldwide, and the Federal Reserve’s rate cut pushed down the US dollar against a basket of foreign currencies. A lower dollar would usually put upward pressure on oil prices, which could counterbalance OPEC+ production increases. That has not been the case this year.
And this pressure in the oil market comes as increasing electricity demand from the data centers fueling the AI arms race has increased pressure on the US power grid and contributed to electricity bills ticking upward throughout the country, with few answers as to how to address the issue.
One potential answer is nuclear power. Stocks tied to this theme have rallied in kind, with Bank of America recently predicting that the opportunity could be $10 trillion in the coming decades.
Economic data: Chicago Fed national activity index, August (-0.19 previously)
Economic data: Philadelphia Fed non-manufacturing index, September (-17.5% previously); S&P Global US manufacturing PMI, September preliminary reading (53 previously); S&P Global US services PMI, September preliminary reading (54.5 previously); S&P Global US composite PMI, September preliminary reading (54.6 previously)
Economic data: MBA mortgage applications, week ending Sept. 19 (+29.7% previously); New home sales, August, annualized rate (652,000 previously, 655,000 expected); New home sales, month-on-month, August (+0.5% expected, -0.6% previously); Building permits, August, annualized rate (1.31 million previously); Building permits, month-on-month, August (-3.7% previously)
Earnings calendar: Cintas Corporation (CTAS), Uranium Energy Corp (UEC), KB Home (KBH)
Economic data: Wholesale inventories, month-on-month, August preliminary reading (+0.1% previously); Retail inventories, month-on-month, August (+0.2% previously); Personal consumption, second quarter, final revision (+1.6% previously); GDP price index, second quarter, final revision (+2% previously); Core PCE price index, quarter-on-quarter, second quarter, final revision (+2.5% previously); Durable goods orders, August preliminary reading (-0.8% expected, -2.8% previously); Initial jobless claims, week ended Sept. 20 (231,000 previously); Continuing claims, week ended Sept. 13 (1.92 million previously); Existing home sales, August, annualized rate (3.98 million expected, 4.01 million previously); Existing home sales, month-on-month, August (-0.8% expected, +2% previously)
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