| T&Q Week In Review | Find out what you missed! | | | | | | Markets spent the week grinding higher through a narrowing set of signals, drifting toward the Fed meeting with confidence in the outcome but uncertainty in the path.
The dominant force was labor data arriving in conflict. ADP showed its sharpest payroll contraction in more than two years, Challenger layoffs pushed past 1.17 million year to date, and yet weekly jobless claims collapsed to 191,000, the lowest since 2022.
The message was as contradictory as it gets: hiring is cooling, but the floor under employment is proving stubbornly resilient. | That tension drove the rate narrative. Fed cut odds surged back toward 90 percent as softer private payrolls, slowing pay growth, and easing inflation expectations reasserted control of the tape. PCE moved closer into view as the final confirmation catalyst, with core expected to cool modestly while headline inflation remained sticky enough to keep the committee divided. | Equities traded accordingly. The S&P 500 and Nasdaq pushed toward record territory in controlled fashion, small caps extended their rate-sensitive rebound, and sector leadership stayed rotational rather than explosive. | Industrials, communications, and select cyclicals advanced, while defensives lagged. Volumes remained light throughout, reinforcing the sense of positioning ahead of policy rather than conviction chasing. | Rates delivered the real story beneath the index calm. Treasury yields firmed as front-end funding pressure reasserted itself, signaling that liquidity conditions, not equity optimism, continue to dictate the market's internal rhythm. | The dollar snapped a prolonged losing streak, gold held firm near historic levels, and oil rose modestly as hopes for a quick Russia-Ukraine energy reset faded. | Geopolitics added a longer arc beneath the macro tape. Putin's summit in India expanded energy and defense cooperation while the U.S. quietly set a 2027 deadline for Europe to take over most of NATO's conventional defense burden. The message was consistent across both theaters: alliance structures are being stress-tested, not stabilized. | Washington delivered its own volatility. The Supreme Court's decision to revive Texas's redrawn congressional map injected fresh uncertainty into the 2026 electoral math, while the court also prepared to weigh Trump's removal of an FTC commissioner in a case that could reshape the independence of the entire administrative state. Policy risk broadened even as markets stayed orderly. | The week closed as it began: a market leaning higher, trading on fragments, confident in a December cut but far less certain about what comes after. |
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| | | | | | | | The coming week brings the most important policy and labor convergence of the year's final stretch. Where this week built the narrative, next week will confirm or fracture it. | On the economic front, the focus tightens squarely on employment and trade. ADP and JOLTs will refresh the market's most fragile input, the true state of hiring beneath seasonal noise. | With claims already sending mixed signals, these reports will either validate the slowdown story or force a sharp recalibration. | The Balance of Trade will land alongside that data set, adding another macro layer to growth expectations as global demand patterns continue to shift. | The centerpiece, however, is the Fed Interest Rate Decision. With near-consensus pricing for a quarter-point cut, the outcome itself matters far less than the guidance architecture around it. Powell's framing of the recalibration phase, the tolerance for additional easing, and the committee's visible dissent will define the first quarter narrative for 2026 positioning. | Earnings return to center stage in focused form. AutoZone and Costco will offer contrasting reads on consumer durability across income tiers. Oracle, Adobe Systems, Synopsys, and Broadcom form a tightly linked AI and enterprise software sequence that will either reaffirm the capex resilience story or expose cracks beneath the infrastructure build-out. | The tape enters the week constructive but narrow. Equities are near highs, rate cuts are priced, and volatility remains compressed. That makes the market increasingly sensitive to direction, not magnitude. | By Friday, traders should finally know whether employment is cooling cleanly or simply stalling, whether the Fed sees policy as still restrictive or already neutral, and whether growth leadership is consolidating or quietly fading into year-end. | This is the final alignment week of the year. What locks in here will carry straight through December. |
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