Morning News: September 30, 2026
Posted by Eddy Elfenbein on September 30th, 2026 at 7:03 am

Abu Dhabi’s Crown Prince Is Spending Billions to Bypass Iran’s Grip on Hormuz

China Has the Power to Bail Out the Diesel Market. Will It Use It?

The Big Tax Grab China’s Rich Didn’t See Coming

Swiss Franc Debt Lures First-Time Issuers From Chile to Latvia

German Inflation Jumps to Highest Level in Almost Three Years

Trump’s New Tariffs Face a Familiar Court Challenge

The ‘Intangible Economy’ Is Making Everyone Miserable

Bracing for More Inflation Volatility

The End of Private Equity’s Leveraged Buyout Era Is Nigh

Chilly Markets and AI Safety Debates Derail Wall Street’s Blockbuster IPO Season

$40T National Debt Alarmists Ignore How Much Bigger We Are

All US Kids May Automatically Get Trump Accounts Under New Rule

The Gap Between the Rich and the Very, Very Rich Is Getting Wider

US Mortgage Rates Rise to an Almost Three-Year High of 7.3%

Unlocking the Value of Low-Rate Home Mortgages

Climate Change Is Making Groceries More Expensive

Startups Race to Cash In on Gold Rush Sparked by Whey Protein Shortage

Hormel Foods to Buy Brakebush Brothers for About $1.06 Billion

The Surprises That New CEOs Face

America’s Office Bust Is a Golden Opportunity for Downtowns

Trump Backs Independent AI Audits in Shift of Safety Posture

Hedge Fund’s Near Collapse Lays Bare Risks of Borrowing to Bet on A.I.

How Meta Uses A.I. Data Centers to Avoid Billions in Federal Taxes

Apple Is Finally Ready to Enter Its Next Big Category: the Smart Home

Samsung Unveils Pricier Tablets and a Longer-Lasting Item Tracker

What It Takes to Get a Job at SpaceX

SPCX CEO Elon Musk Warns Delta Will ‘Lose A Lot Of Customers’ Over Starlink Snub — Even as Rival United Already Has 600+ Jets Connected

We Are Alarmed to Learn That People Are Installing DIY Self-Driving “Mods” on Their Cars

Paramount Deal Delay Fuels Fear of Costly $52 Billion Debt

Manchester City’s Torment Is a Dream for Its American Rivals

Why Shein Faces an Uphill Battle to Revive Its Growth

Be sure to follow me on X.

CWS Market Review – September 29, 2026
Posted by Eddy Elfenbein on September 29th, 2026 at 7:03 pm

(This is the free version of CWS Market Review. If you like what you see, then please sign up for the premium newsletter for $20 per month or $200 for the whole year. If you sign up today, you can see our two reports, “Your Handy Guide to Stock Orders” and “How Not to Get Screwed on Your Mortgage.”)

The third quarter of 2026 comes to an end with tomorrow’s closing bell. Overall, it was a middling quarter for the stock market. OK, but not great. For the quarter, the S&P 500 added about 2%. If we look at the total-return index (meaning, with dividends), then the S&P 500 was up by 2.4%. Mind you, these aren’t final numbers. There’s still a little more trading to go.

Q3 was very different from Q2. That’s when the S&P 500 rallied over 14% to notch its best quarter in six years. Q3 wasn’t nearly that exciting. Except for a quick bounce that added 5.75% in four days starting in late July, there wasn’t much drama in the market. Since May 6, the S&P 500 has largely stayed between 7,300 and 7,700.

Nvidia (NVDA) made news this week by adding $150 billion to its buyback. (Someone there thinks it’s a bargain!) Lately, the real action has been going on in the bond market. Since August 25, the yield on the 10-year Treasury bond has gained 60 basis points. That’s a big move for such a short period of time. The yield on the 30-year bond just got to a 24-year high.

What’s behind the bond selloff? There are a few reasons. I’ll cover that in greater detail in just a bit, but the important takeaway is that higher yields have a major impact on the economy. It’s no accident that higher long-term yields have often preceded bear markets. I’m not urging you to run for the hills, but investors ought to be prudent.

Higher yields have several effects. For one, it’s harder to borrow money. That makes buying a car or a new home more expensive. In turn, that can hold back the plethora of workers and businesses that are tied to housing (roofers, electricians, plumbers, etc.). It’s a good time to buy a house with all cash.

Higher yields also act as tough competition against stocks. There’s basically a never-ending battle on Wall Street between stocks and bonds. At yesterday’s close, the yield on the 20-year Treasury was going for 5.6%. That means an investor with $1.8 million can buy those bonds and make an average of $100,000 per year for 20 years. Personally, it’s not for me, but I understand why many investors would have little problem taking that deal.

Higher yields also make it more difficult for businesses to borrow money. That puts a damper on mergers and acquisitions, which is a very profitable area for investment banks. It’s no surprise that in recent days, financial stocks have badly lagged the overall market.

The U.S. continues to motor along. The economy is growing by more than a recession but by less than anything impressive. Kevin Warsh said, “the American economy appears to be strengthening,” which may be true, but I have my doubts. Today’s consumer confidence report fell to its lowest level since 2014. The Consumer Confidence Index fell 6.7 points to 81.9. Wall Street had been expecting 89.

On Wednesday, ADP will release its report on private payrolls. The company expects to see a gain of 68,00 new jobs. Of course, that’s the unofficial report. The big, official September jobs report is due out on Friday before the opening bell. Wall Street expects to see a gain of 84,000 net new jobs. That’s almost half the gain of what we saw for August.

Wall Street expects the unemployment rate to remain at 4.1% and for average hourly earnings to increase by 0.3%. The Federal Reserve doesn’t meet for another month, but it looks like we’ll get another rate increase just before Halloween. The bottom line is that rates are most likely to go higher and higher.

Now let’s look at what’s been roiling the bond market.

The Foiled Plan to Lower Inflation

As usual, I’ll steer clear of politics, but I will touch on some important public policy choices. For example, early in his second term, President Trump’s advisers give him a simple roadmap to cure inflation.

They assured him that fiscal restraint combined with deregulation would bring down prices. The best part of this plan is that he wouldn’t need to worry about a non-compliant Federal Reserve.

Well, that plan never happened. Instead, we got war, tariffs and an investment boom. Now, inflation is moving up and the yield on the 10-year Treasury is above 5%. That’s a 19-year high.

Fiscal restraint never arrived, and tariffs raised the cost of imports. On top of that, immigration restrictions shrank the labor force. The economy is still moving along, and energy prices are higher than ideal.

Earlier this year, mortgage rates were around 6%. Now they’re at 7%. That works out to $3,000 extra dollars on a $400,000 mortgage. That’s a big bite for a young family.

Consider this fact: Uncle Sam’s interest payments on our debt just reached $1 trillion for the fiscal year. That’s nothing we get. It’s just interest payments we’re making.

Of course, not all of this can be laid at President Trump’s doorstep. The massive AI boom is driving up the cost of several items like chips, components and power equipment. The problem now is that the mega-cap tech stocks are competing against the government to borrow money. If I know the bond market, it’s more than willing to lend to blue chip borrowers.

The economy really isn’t in a bad place, for now. Unemployment is still quite low, and the stock market is not far off its all-time high.

As has often happened with bold plans to restructure the government, reality intrudes. At first, Trump was serious in cutting the deficit. Remember DOGE, the Department of Government Efficiency? Elon Musk said he could find $2 trillion worth of waste. Trump also pushed for tariffs, but the Supreme Court said some of his moves went outside the president’s authority.

This summer, Treasury Secretary Scott Bessent said the Treasury Department will double its purchases of long-term bonds. The idea is that this would push down rates. Well, that worked for about day. Since then, yields have been climbing higher.

The government’s fiscal year ends tomorrow. It will probably turn out that the size of the deficit will be twice what Bessent had expected. Now, everyone wants to spend money. President Trump recently pledged $5,000 for every adult if Republicans keep control of the House and Senate.

We also have a new Fed chairman in Kevin Warsh who has taken a strong stand against inflation. The Fed has already raised rates once and looks to do so again before the end of the year.

The impact of the war isn’t just oil, but higher prices are being seen in other areas. For example, diesel prices are rising. That’s important because that impacts farm equipment and trucks.

The president said that oil prices would soon fall once the conflict with Iran was resolved. Here we are several months later, and the prices are still elevated.

The concern is that the impact of higher interest rates will have little impact on what’s really driving higher prices. I get what they’re saying. Will Nvidia really hold off going to the bond market due to a 0.25% rate hike? I doubt it.

Three Dark Horse Candidates for Next Year’s Buy List

Now that 2026 is three-quarters over, I want to share with you some “off-the-beaten-path” stocks that I’m considering for next year’s Buy List.

Let’s start with Credo Technology Group (CRDO). The company designs “zero-flap” active electrical cables that connect GPUs in massive clusters. This is a highly specialized niche essential for AI applications. Their connections are reportedly 1,000 times more reliable than standard competitors. This ensures that AI training processes don’t randomly drop signals and reset. Credo’s revenue has exploded (fiscal Q1: +114.7%), with expectations of major multi-billion-dollar growth over the coming years.

CECO Environmental (CECO) provides industrial air quality and fluid handling systems, which are increasingly vital for factories, data centers and energy infrastructure.

Wall Street analysts have taken notice of CECO’s massive $1 billion backlog and $7 billion pipeline. Thanks to heavy tailwinds from U.S. manufacturing reshoring and AI data center expansion, CECO is delivering stronger revenue and cash conversion growth than almost all its peers. CECO just completed a $2.2 billion cash-and-stock acquisition of Thermon Group Holdings, a process-heating company.

Toast Inc. (TOST) provides specialized point-of-sale (POS) and operational software that’s tailored for restaurants. Toast has a strong moat by helping restaurants manage everything from table orders to inventory and employee scheduling.

Toast’s recurring gross profits have surged over 30% recently, allowing them to sustain rapid annual growth even in a fluctuating consumer environment.

That’s all for now. The September jobs report is due out Friday morning. Wall Street expects to see a gain of 84,000 new jobs—that’s nearly half of August’s gain—and for the unemployment rate to be 4.2%. I’ll have more for you in the next issue of CWS Market Review.

– Eddy

Morning News: September 29, 2026
Posted by Eddy Elfenbein on September 29th, 2026 at 7:12 am

Oil Mogul’s Hunt for Venezuela Riches Began Years Before Maduro’s Capture

One Side Just Overplayed Its Hand in Iran

Mideast Oil Exports Rebound Even as Prices Remain Elevated

Hapag-Lloyd Raises Guidance Again on Strong Demand, Freight Rates

How Asia Has Survived the Energy Crisis

Guessing ECB Hikes Is Easier Than Picking Its Next President

How the US-Canada Trade War Is Intensifying

U.S. Bans Canadian Motorcycles, Dairy and Liquor

Tariffs Will Not Build Out the ‘Missing Half’ of U.S. Semiconductors

There’s a New Threat to Your Personal Finances

US Stock Futures Rise as Traders Await Key Economic Data

Dollar Rises to 2-Month High on Growing Prospect of October U.S. Rate-Rise

A Rising National Debt Bodes Well For Stocks and Bonds

Could There Be a Run on the Bond Market?

24/7 Stock Trading Is About to Test Financial Markets

Tax-Slashing ‘Holy Grail’ Popularized by AQR Dealt IRS Warning

Goldman’s John Waldron Edges Closer to Succeeding Solomon as CEO

Waldron Long Seen as Next Goldman CEO. The Question Is When

For Japan’s Young Singles, Romance Gets a Corporate Middleman

Could Homeownership Reverse the Decline in Birthrates?

The Flawed Logic of Medicare for All

Can $888 Million in GOP Ads Make Voters Forget Their Malaise?

The Pentagon’s Blockade on American Wind Energy Must End

Mesabi Metallics Plans to Build $15 Billion Steel Mill in Iowa

Microsoft Retreats From Consumer AI to Focus on Business

AI May Force 11 Million Workers Into New Jobs, McKinsey Says

What’s in Anthropic’s I.P.O. Filing

Oura Postpones IPO Over Market Uncertainty

Subprime Auto Loans Make Wall Street Rich as Borrowers Struggle

Car Dealers Are Desperate for New Models but There’s an Industrywide Drought

CarMax Posts Higher Profit as Turnaround Takes Shape

Shein’s Earnings Disappoint, Sending Stock Lower

Senate Passes Legislation to Limit College Player Transfers

Be sure to follow me on X.

Morning News: September 28, 2026
Posted by Eddy Elfenbein on September 28th, 2026 at 7:07 am

Make Chaos Work for You

Rhine Drops Below Shipping Threshold as Freight Costs Rise

Oil Prices Climb on Continued Impasse in U.S.-Iran Talks

Goldman Expects Initial Diesel Price Decline Under US Export Curbs

Saudi Arabia’s Key Oil Pipeline Starts Exports After Repairs

Japan Could Redraw the Global Oil Map

U.S. Pressure Is Awakening an Energy Giant in Canada

Trump’s Tariffs Push Canadian Companies to Look Past American Links

China and the U.S. Pledge to Cut Tariffs on $60 Billion in Goods

The Moves That Backfired on Trump and Drove Interest Rates and Inflation Higher

US Stocks Decline as Middle East Stalemate Pushes Oil Higher

Opposite What You’re Told, Markets Don’t Wait for the Fed

Warsh’s Credibility Boost Is Bessent’s Comeuppance

An Inversion of the US Yield Curve Becomes New Risk as Fed Hikes

Rethinking the Fed’s Path Sends Bond Yields Higher, But a Data Test Is Looming

What an NFL Legend Can Teach You About Small-Cap Stocks

London to Athens Is the New Hedge Fund Odyssey

Prediction Markets’ Push Into US Stocks Raises Regulatory Alarm Bells

AI Is Repricing Capital Before It Reprices the Economy

Could A.I. Safety Risks Derail the Sector’s I.P.O. Prospects?

‘I Write This to Frighten You’: How Scientists Took On Existential Risk Once Before

Nvidia Debuts System Designed to Stop AI Agents From Going Awry

Nvidia Adds Record $150 Billion to Stock Buyback

China Broadens Travel Curbs to Encompass Family of Top AI Talent

Every Household in This Rural Town Receives $10,000 if a Data Center Gets Built

Job Titles Are Out. Now We’re All ‘Members of the Technical Staff.’

Driverless Trucks Show How to Keep AI Robots From Killing Us

Smart Headlights Finally Trickle Down to Cars in the U.S.

This Screw Is Needed for Missiles and Planes. Buying One Can Take Years

Northern Star Rejects $27 Billion Takeover Proposal from Gold Fields

Prada Is Wooing the Ultrarich with Snorkeling Trips and $100,000 Skirts

Juniper Lattes? Pine Sodas? Food Is Taking Us Back to the Forest.

Be sure to follow me on X.

Morning News: September 25, 2026
Posted by Eddy Elfenbein on September 25th, 2026 at 7:03 am

Trump Advisers Analyzing Impact of Short-Term Diesel Export Ban

Why a U.S. Diesel Export Ban May Not Lower Prices

US Container Shipping to Cuba Surges Despite Trump’s Ever-Tighter Sanctions

For China, a Truce With Trump Buys Valuable Time

The Death of Expertise at a Devasting Cost to the U.S.

Make Threats of Annihilation Taboo Again

A Dollar Is Not a Dollar: A Plea To Make Dollar Policy Great Again

Bond Yields at 5% Mark New Era ‘Until Something Breaks’

Why High Bond Yields Look Like the New Normal

US Fed Plans to Raise Bank Oversight Thresholds

The Problem Is Where Interest Rates May Go, Not Where They Are Now

Millennium’s New Cash Raise Draws $30 Billion in Client Demand

When Regulation Changes Who Becomes Rich

The Rise of the Almost-Premium Credit Card

Portland Real Estate Is Such a Mess That All Housing Is Affordable Housing

Vance’s Plan for Stay-at-Home Moms Thinks Too Small

Going Into Debt Helped Her Go Viral. Now She’s Resolved to Stay in Debt

Kalshi’s Backroom Tax Victory Gives It Leverage in Legal Fights

Massachusetts Is Investigating Gambling Companies’ Use of A.I.

The World Needs Better Power Grids. Why Smaller May Be Better.

Goldman Sees Hyperscaler AI Capex Rising 50% to $1.2 Trillion

AI’s Nuclear Power Push Runs Into Cost and Regulatory Hurdles

Jeff Bezos’ Blue Origin Is Fueled With $30 Billion of His Fortune

Anthropic to Pay Akamai Technologies $11.6 Billion Over Seven Years for Cloud Services

SpaceX-Focused Pentagon Contracts Leave Rivals Feeling Squeezed

How Might Free Thinkers Address Government Surveillance Cameras?

Tata Dispute Sends India Inc Scrambling to Shore Up Shareholder Rights

Americans Are Going Wild for Minivans

Moderna CEO’s Realistic Approach to Innovation

Costco Reports Higher Fourth-Quarter Profit, Revenue on Resilient Consumer Spending

Mark Zuckerberg Is Trying Something On

H&M Discovers It’s Tough to Make Money Selling Used Dresses for $5

Be sure to follow me on X.

Morning News: September 24, 2026
Posted by Eddy Elfenbein on September 24th, 2026 at 7:13 am

Bond Markets Are on Edge and Oil Prices Rise

Global Bond Selloff Sends US 30-Year Yield to Highest Since 2004

Bond Yields Return to 2007, But It Could Be Worse

The ‘Monster’ Behind Russia’s Global Effort to Evade Western Sanctions

Flow of Chinese Components to Iran Shadows Trump’s Summit With Xi

Xi’s Economy Is Failing China’s People

We Shouldn’t Be Playing China’s Game

Europe Is In a Dangerous Place. It’s On the Trump-Xi Menu

Why Trump Wants to Cryptofy the Futures Markets

As Bessent Tinkers With Treasuries, a Warning Against ‘Financial Engineering’

The Trump SEC’s Accidental Gift to Left-Wing Activists

Non-Profit Taxation Would Amount to Quadruple Taxation of the Rich

Rich People Fleeing Private Credit Haven’t Learned Their Lesson

Morgan Stanley Rushes to Check Fallout After Deal List Leak

Mortgage Rates at 7% Are Forcing Home Sellers to Slash Prices

The AI Build-Out Is Becoming the Biggest Economic Bet in U.S. History

AI Trade Is Ground Zero as Stock Investors Map Election Risks

The Railroads Were Once the Octopus That A.I. Is Now

A.I. Safety Concerns Go Global

A Kill Switch for AI? Microsoft’s Brad Smith Says Yes

The AI Folks Don’t Seem to Understand Intelligence

Oracle Cites ‘Force Majeure’ to Shield Itself on Controversial Data Center

In a Race With China, German Robots Are Outnumbered 14 to 1

Is 3-D Printing the Answer to AI’s Gas Turbine Crunch?

How Elon Musk’s Sunbelt Investments Are Reshaping His Business Empire

Battle of Hospital A.I. vs. Insurer A.I. Is Pushing Medical Costs Higher

White House Backtracks on Plan to Exert New Control Over N.I.H. Grants

Investors Are Betting On Devices That Connect the Brain to Computers

Wearable Devices Sadly Get Their First Dose of Regulatory Attention

L.A. Comes to Grips With a Studio Merger Many Didn’t Want

Starbucks to Close 250 Underperforming Stores

Darden Restaurants Posts Sales Gains but Profit Slips on Higher Expenses

LVMH’s Arnault Family Moves to Cement Control With Ownership Overhaul

Be sure to follow me on X.

Morning News: September 23, 2026
Posted by Eddy Elfenbein on September 23rd, 2026 at 7:05 am

Global Economy Stronger Than Expected, But Threats Mount, OECD Says

Here’s a Crystal Ball Glimpse of the Global Economy in 30 Years

Trump’s Diesel Dilemma

White House Considers Ban on Diesel Exports as Prices Keep Rising

Trump’s Oil Allies See Nightmare Scenario of Diesel-Export Ban Becoming Reality

A US Diesel Export Ban Would Be a Calamity for the Market

Obscure UAE Firms Hold Key to Radiant’s $1 Billion in Assets

How Chevron’s CFO Leads Through Global Tumult—‘You Plan for It’

Don’t Believe the Hype About China’s Oil Buying

The US Is Badly Losing Its Trade War With China

Dollar Jumps to 8-Week High as Fed Rate-Hike Bets Outweigh Lower Oil Prices

There’s a Secret Third Path to Escaping America’s Debt Trap

Socialism and Communism: A Distinction Without Difference

In Court Filing Defending Media Ban, White House Says Access Is a ‘Privilege’

Wants, Needs, and the Rising Cost of Municipal Debt

US Mortgage Rates Surge Above 7% to a More Than Two-Year High

Even With Reductions, the Corporate Tax Rate Is Still High

Xi and Trump Seek Safe AI Without Slowing the Race for Supremacy

AI Data Centers Release Heat, Posing New Problem for Cities

OpenAI Wants to Consult Elite Mathematicians About How to Not Fumble Again

SoftBank Offers Record Yields on Jumbo Junk Bonds in AI Push

Should You Buy Micron Before Sept. 30? 1 Number Could Send the Stock Soaring

Meta’s Muse Drags Down Stocks That Depend on ‘Consumer Inertia’

Amazon Is Trying to Rehire Workers It Laid Off

Arcadis Shares Fall After Canada’s WSP Global Pulls Takeover Offer

Nucor Supply Chain Tainted by Evidence of Modern-Day Slavery

How Ford and GM Can Avoid VW’s China Pains

Porsche’s Decline from Crown Jewel to Millstone for Parent Volkswagen

A $5,000 Bike Shows Why It’s Hard to Build in America

General Mills Profit, Sales Slip as Turnaround Continues

Cracker Barrel Post Profit Gains, Guides for FY Sales Growth

Royal Caribbean Acquires Stake in Resort Operator Sandals for $3 Billion

Be sure to follow me on X.

CWS Market Review – September 22, 2026
Posted by Eddy Elfenbein on September 22nd, 2026 at 5:05 pm

(This is the free version of CWS Market Review. If you like what you see, then please sign up for the premium newsletter for $20 per month or $200 for the whole year. If you sign up today, you can see our two reports, “Your Handy Guide to Stock Orders” and “How Not to Get Screwed on Your Mortgage.”)

The stock market has been in a relatively buoyant mood this week. The S&P 500 narrowly missed closing higher for four days in a row. In fact, Wednesday was the market’s best day in seven weeks, and it’s very close to another all-time high. The current all-time high was set on August 13. Over that time, the market had a brief 3.2% drawdown; and we’ve nearly made it all back.

The Nasdaq has been even more impressive. That index reached an all-time high today. The tech-heavy index reached its previous all-time high in June. If you recall, the Nasdaq had a 10% drawdown during June and July. Once again, we made it all back.

The market has swung sharply in favor of growth stocks. This continues a trend that started in late July. Typically, higher short-term interest rates from the Fed work to punish rate-sensitive and high-duration stocks, and that’s exactly what we’ve seen.

For example, the S&P 500 Utility Index (XLU) just touched a new 52-week low. This is happening at the same time that the S&P 500 Growth Index (SPYG) is at a new 52-week high. It’s not so much the fault of the Federal Reserve, but the market is reacting to the same forces the Fed is facing.

Make no mistake: this is still a market that’s fixated on AI. Advanced Micro Devices (AMD) just became the latest $1 trillion company. There are now 12 stocks in the “Four Comma Club.” Expect to see more.

The folks at FactSet broke down the earnings calls from the most recent earnings season. They found that the term “AI” was referenced in two-thirds of the earnings calls. This was the third quarter in a row that AI has appeared on more than 65% of earnings calls. AI was mentioned on 97% of tech earnings calls.

As you might guess, the AI trade is back. Shares of Meta (META) rallied 11% after its new Muse AI agent became #1 at the App Store. Intel (INTC) jumped about 12%, and several other chip and tech names followed.

The Treasury bond market eased up a bit today. The yield on the 10-year Treasury fell below 5%. The Federal Reserve doesn’t meet again for another five weeks, but traders are already speculating on the Fed’s next move. For now, traders are nearly 50-50 on the idea of the Fed hiking rates in October.

Frankly, we’re also in a bit of a slow patch for economic news. This week, we’ll get reports on new-home sales and jobless claims. Next week will be more newsworthy as we’ll get the GDP report and the September jobs report.

The U.S. unemployment rate has been below 4.5% nearly every month for the past four years. In previous times, that would be considered remarkable. Now, it seems like everyone is nervous and pessimistic. Charlie Bilello points out that the unemployment rate has now been below 5% for 60 months in a row. That’s the longest streak since the 1960s.

In the last 17 years, the U.S. economy has been in one two-month recession, and that was due to Covid. We haven’t seen a recession that started for purely economic reasons since 2008. Despite this, all the polls indicate that Americans are quite pessimistic on our future prospects.

Check out this chart of the S&P 500 Growth Index (blue) versus the S&P 500 Value Index (green).

Except for a sharp reversal in June and July, growth has been beating value. Notice how stable the value line is compared with the frenetic growth line.

This highlights an important truth: there are a lot of companies that are being left out of this rally. The problem with such a narrow rally is that it can easily be reversed. Close to 190 stocks in the S&P 500 are more than 20% off their 52-week highs.

Half the stocks in the S&P 500 Energy Index are more than 10% off their 52-week highs, and several of those are more than 20% off. Texas Pacific Land Corporation (TPL) is down more than 30%.

Q3 Earnings Season Preview

Next week, the third quarter of 2026 comes to an end, and the Q3 earnings season will begin shortly after. The unofficial kickoff for Q3 earnings season will be Tuesday, October 13. That’s when JPMorgan (JPM), Wells Fargo (WFC), Citigroup (C) and Goldman Sachs (GS) are due to report. Usually, the big banks are the first to report. A handful of companies with August fiscal year-ends have already reported (Oracle, Adobe and Lennar).

Expectations for Q3 are quite high. The Q2 earnings season was quite good. There had been some nervousness that expectations may have been too high, but that turned out not to be the case.

The number crunchers at FactSet expect Q3 revenue growth of 11.9%, and earnings growth of 28.7%. If that’s right, then it will mark the third quarter in a row in which earnings growth topped 25%.

Interestingly, estimates have been revised higher since the middle of the year. At last count, positive guidance is outrunning negative guidance, 72 to 42. Typically, the reverse happens. Earnings estimates are pared back until earnings season. That lets companies lower the bar until they can easily jump over it. On Planet Wall Street, it’s all a big expectations game.

One positive aspect is that earnings growth appears to be broader and not just mega-cap tech stocks, even though stock prices aren’t reflecting this. The big winner looks to be the energy sector. Thanks to high prices, earnings are expected to double. Obviously, tech is a big player. Earnings at Nvidia (NVDA) are expected to be up 90%. Micron (MU) is expected to be up triple digits as well. MU is due to report after the close one week from tomorrow.

Wall Street expects decent gains for areas like materials, aerospace and transportation. Consumer staples are expected to be flat. If you take out energy, then overall growth falls to the low 20% range. Take out tech, and it falls even more.

In particular, investors will focus on capex spending by the mega-cap names. On top of that, we have geopolitical risks that could impact the market. Overall, the bar is set high for earnings. Expect to see a lot of “earnings beats,” but we want to hear positive guidance for the rest of 2026.

Also, keep an eye on Costco (COST). The store will release earnings after the close on Thursday. Shares of COST haven’t been that strong recently, which is rare for them. Over the last 16 months, the S&P 500 is up 47% while COST is down 6%. Is it a bargain? I’m not so sure. Even after the downturn, COST trades at 40 times next year’s earnings. On Wall Street, even the best stocks will hit rough patches.

That’s all for now. The new-home sales report is due out on Thursday along with the regular jobless claims report. I’ll have more for you in the next issue of CWS Market Review.

– Eddy

Morning News: September 22, 2026
Posted by Eddy Elfenbein on September 22nd, 2026 at 7:09 am

Record Oil Supertanker Rates Make Waves for the Whole Fleet

Saudis in Process of Starting Vital East-West Oil Pipeline

Global Oil Price Drops Below $100 a Barrel

Beware Oil’s Second Strike on Inflation

Gulf States Set to Urge Trump to Avoid Any Escalation With Iran

Erdogan: The UN Should Abolish the Security Council Veto

Milei’s US Trade Deal Is Under Threat as Argentina Demands Better Terms

China’s Continued Control of Rare Earths Looms Over Trump-Xi Meeting

What’s Behind Bessent’s Boasts About the U.S. Bond Market

This Historic Divide Between Bulls and Bears Signals a Slowdown

Better Reading Lists Will Not Fix a Problem of Too Much Tax Revenue

Ratings’ Agencies Are Grading a Test That Ended 5 Years Ago

Private Equity Firms Cling to Assets for Longer, Upending Business Model

Trump’s Crypto Venture Got Rich While Big Promises Fell Short

Trump’s Immigration Crackdown Is Changing How Undocumented People Bank

SoftBank Draws Over $20 Billion of Early Interest in Junk Bond

The Office Bust Is Shifting From Empty Towers to Investor Losses

Banks Warn AI Shopping Bots Raise Scam, Fraud and Data-Privacy Risks

Wall Street Is Growing Skeptical of the Data Center Boom

Where Intelligence and Consciousness Have to Be Separated

Alibaba Unveils New AI Chip, Calls It China’s Most Powerful

Nvidia’s Stock Is Flashing a Warning Sign as Valuation Falls

Jensen Huang Has a $5.4 Trillion Reason to Block AI Rules

AI Is Changing the Business School Case Study

A Rocket Supply Crunch Is Making It Harder to Hitch a Ride to Space

SpaceX’s Falcon 9 Phaseout Spurs Hunt for New Ways to Launch Payloads

China Expands Drug Chemicals Control Ahead of Xi’s Trip to US

Novo CEO Says Drugmaker Has Overpromised, Underdelivered

AutoZone Sales Rise and Further Growth is Expected

DoorDash to Pay $132 Million to NYC, Workers Over Missing Wages

The ‘Kid’ Takes Over: David Ellison Becomes a Hollywood Colossus

What’s Next for Paramount

Be sure to follow me on X.

Morning News: September 21, 2026
Posted by Eddy Elfenbein on September 21st, 2026 at 7:05 am

A Shortage of Oil Tankers Is Threatening to Keep Gas Prices High

Trump’s Venezuela Oil Deal Hinges on Decrepit and Distant Fields

Qatar Energy Chief Says Bessent ‘Wrong’ About Hormuz Future

Trafigura Sees Mideast Oil-Tanker Buying Spree Prolonging Boom

Trump, Xi and the Challenge to Claim the Upper Hand on Trade

China Promised to Buy More U.S. Farm Goods. It Hasn’t Happened

Bessent Hails Progress on A.I. Talks With China. What Comes Next?

The Tough AI Questions Looming Over the Trump-Xi Summit

NSE’s $2.4 Billion India IPO Subscribed 5.7 Times as Books Close

Kevin Warsh’s Rate Hikes Revive The Paul Volcker Myth

Fed’s Goolsbee Says Road to 2% Inflation May Not Be Painless

The U.S. Treasury’s Multi-Trillion Dollar Mistake

Old School Voice Brokers Face Automation in $4 Trillion FX Market

How Prediction Markets Upstaged Election Polls

Crypto Can’t Go Mainstream Without Clarity

JPMorgan, Qatar’s QIA Target $20 Billion Investment Partnership

The Great Stuff Transfer Has a $750 Billion Golden Lining

Apartment Landlords Have a $2 Trillion Debt Problem That Is Only Getting Worse

CNN Removed From White House TV Press Pool After Trump Ban

3 News Outlets Say They Will Sue to Regain White House Access

‘Crisis Even Bigger Than Covid’: American Business Owners Are Barely Getting By

Trump, AI Boosters Out of Touch With Public Sentiment

When the Three Most Powerful Men In AI Agree, Read the Fine Print

AI Risk Is Everywhere and It’s Making Billion Dollar Funds Nervous

AI Adoption Is Driving Hiring, But Mostly for Senior Roles

Young Consultants Are Jumping Ship for A.I. Start-Ups

New Data Centers Worth $68 Billion Disrupted in US

Smart Ring Maker Oura, Backers Seek $2.2 Billion in US IPO

A Texas Plant Shows US Manufacturing Can Return — at a Cost

How to Make More Cars in America? Rivian’s C.E.O. Has Some Ideas

How Harley-Davidson, an American Icon, Became a Tariff Punching Bag

Bayer Sells Cancer Drug to Gruenenthal for Up to $431 Million

Microsoft Patents System to Freeze Games and Inject Ads During Downtimes — Watching Commercials Earns Ad-Free Playtime Credits

Be sure to follow me on X.