Consumers haven't been this gloomy since May 😬

Welcome back to the Day Trading newsletter 📈

Four straight down days, a 10-year Treasury yield that flirted with 5% for the first time since 2023, oil back above $100, and then a Friday relief rally that left the S&P 500 down about 0.8% for the week.

Now the Fed meets Wednesday with traders betting roughly 90% odds on a rate hike, and Friday's consumer sentiment report showed just how tired Americans are of all of it.

Let’s get into it 👇️ 

📆 Monday 9/14 — Iran-Gulf states talks on the Strait of Hormuz in Oman (no set time ET): Gulf Cooperation Council foreign ministers meet Iran in Salalah, without the U.S., to discuss an Omani plan for reopening the strait to regular tanker traffic. Any sign of a deal would hit oil prices fast; a breakdown would do the opposite.

📆 Wednesday 9/16 — August Retail Sales (8:30am ET): The first hard-data test of whether record-low consumer sentiment is turning into an actual spending pullback. A weak number hours before the Fed decision would complicate the case for a hike.

📆 Wednesday 9/16 — Fed Rate Decision (2pm ET): Markets price roughly 90% odds of a quarter-point hike, which would be the Fed's first rate increase since 2023 and the first under Chair Kevin Warsh. Watch the dot plot for how many more hikes officials see this year, and the 2:30pm press conference for how he frames near-5% Treasury yields.

📆 Thursday 9/17 — Bank of England Decision + Jobless Claims (7am / 8:30am ET): The BoE is expected to hold at 3.75%, but three of nine members voted to hike in July and the ECB just raised rates, so a surprise is live. Weekly claims are the first labor-market read after the Fed's move; rising claims would revive stagflation worries.

📆 Friday 9/18 — Bank of Japan Decision + Triple Witching (overnight / all day ET): Markets see about 75% odds the BOJ lifts rates to 1.25%, which would strengthen the yen and could pull Japanese money out of Treasurys. Triple witching, the quarterly expiration of stock options, index options and futures, tends to mean heavy volume and choppy trading into the close.

⛽️ Inflation held at 3.4% in August, and traders now see a near-90% chance the Fed hikes rates Wednesday. The consumer price index rose 0.4% for the month, matching estimates, but core CPI came in a touch hot at 0.3%. Gasoline did the damage, up 3.9% in August and 27.4% from a year ago, accounting for more than a third of the monthly increase.

🛢️ Saudi Arabia shut down its East-West crude oil pipeline Friday after drone attacks launched from Iraq hit pump stations near Riyadh and Medina. The 1,200-kilometer line to the Red Sea port of Yanbu was moving 4 million to 5 million barrels a day, roughly 4% to 5% of global supply, as the kingdom's main bypass around the closed Strait of Hormuz. Brent still finished the week up 8.7% at $104.61.

📊 The 10-year Treasury yield came within a whisker of 5% this week, its highest level since 2023. The yield closed near 4.98% Friday after climbing almost 20 basis points on the week as a global bond selloff met hot inflation data. A 5% 10-year matters because it sets the floor for mortgage rates, corporate borrowing costs and the discount rate investors apply to stocks.

💰️ Oracle grew revenue 30% to $19.3 billion as AI cloud sales more than doubled, but its debt pile hit $125 billion. Cloud infrastructure revenue jumped 121% to $7.4 billion and the backlog swelled to $664 billion, yet free cash flow was negative $5.4 billion after roughly $28 billion of capex in one quarter. Shares whipsawed and closed nearly 2% lower Friday. A day later, Larry Ellison scrapped a plan to sell up to $7.5 billion of stock.

🖥️ Dell shares jumped 11% to a record high Friday after RBC Capital Markets started coverage with an outperform rating and a $640 price target. The stock is now up nearly 350% in 2026 as Dell has become one of the top sellers of Nvidia-based AI servers. Its AI server backlog stands at $95 billion, with $60.9 billion of new AI orders booked last quarter alone.

🔐 Sam Altman said OpenAI will not go public in 2026, calling an IPO now an "ill-advised moment" given AI safety concerns. The decision pushes one of the most anticipated listings in history, potentially valued at $1 trillion, to 2027 at the earliest. It came the same weekend Anthropic CEO Dario Amodei published an essay urging AI labs to deliberately slow capability gains, a proposal Altman and Elon Musk both endorsed.

🔻 Adobe beat on the top and bottom lines Thursday but shares fell about 2% after hours on soft fourth-quarter sales guidance. Revenue rose 13% to $6.76 billion with adjusted EPS of $6.13, and the company nudged its full-year outlook higher. Investors wanted more from AI monetization, and a Q4 revenue range of $6.8 billion to $6.85 billion didn't deliver it.

🤖 OpenAI launched ChatGPT for Financial Services, a version aimed squarely at the research, modeling and pitchbook work of junior bankers. Built with Morgan Stanley and Evercore as design partners, it bundles premium data from PitchBook, LSEG and Daloopa on top of OpenAI's latest model. OpenAI compares it to Excel, a productivity tool rather than a replacement, but Wall Street's analyst class is nervous.

The University of Michigan's preliminary consumer sentiment index fell to 47.8 in September, down 7.5% from August's 51.7 and 13% below a year ago.

In a survey that dates back to November 1952, only one reading has ever been lower: this May's 44.8.

Economists polled by Reuters had expected 51. The expectations index did the most damage, tumbling 11.1% to 45.8, while the current-conditions gauge slipped 1.9% to 50.9.

The inflation portion of the survey was arguably worse.

Year-ahead inflation expectations jumped to 4.6% from 4.0%, the highest since June and well above the 3.4% consumers expected in February, before the Iran war began.

Long-run expectations ticked up to 3.4%, ending three straight months at 3.3%. Survey director Joanne Hsu said "Democrats and Republicans alike posted sizable declines," and that with fuel prices resurging and trade tensions rising, "consumers anticipate greater pressures on their pocketbooks to come."

Sentiment is now 16% below where it stood before the war.

Consumer spending is roughly two-thirds of U.S. GDP, so when shoppers turn this sour, the question is whether they actually close their wallets.

The same day this survey landed, the August CPI showed gasoline up 27.4% from a year ago, which is exactly what households are reacting to.

Whether they've actually cut back is the question Wednesday's retail sales report will answer.

Rising inflation expectations are exactly what a central bank fears most, because they become self-fulfilling as workers demand raises and businesses pre-emptively hike prices.

A 4.6% one-year reading gives Chair Kevin Warsh cover to raise rates Wednesday even with sentiment near record lows, and it explains why futures markets moved to price a hike at roughly 90% after Friday's data.

The catch: rate hikes slow the economy by making borrowing pricier, and they land on a consumer who already feels squeezed. Sentiment this low tends to weigh first on big-ticket purchases like cars, appliances and homes.

What to watch:

• Wednesday is the whole ballgame. August retail sales hit at 8:30 a.m. ET, and a weak print would confirm the gloom is turning into a real spending slowdown.

• The Fed decision follows at 2 p.m., with Warsh's press conference at 2:30.

• Then watch whether the final September sentiment reading on Sept. 25 revises up or down; May's record low was followed by a rebound, and the Fed will want to know whether this is a repeat or the start of something worse.

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⚠️ Disclaimer: Not financial advice. Do your research before making any trades.