U.S. Indexes closed higher on Friday, with the Dow outperforming, while the Russell lagged. Most sectors closed higher, led by Technology, Industrials and Consumer Staples and Financials, while Energy was the clear laggard alongside lower crude, followed by Communication Services and Real Estate. Macro focus centred on renewed US-Iran diplomatic optimism. Reports suggested negotiations have moved into a more detailed technical phase, while the Iranian President signalled readiness for an agreement with the US. Iranian sources subsequently pushed back on the prospect of imminent progress, but crude failed to recover and settled firmly lower, with WTI at USD 92.41/bbl and Brent at USD 97.44/bbl. Treasuries steepened, with front-end yields falling while the long end rose. The front end tracked energy prices lower as diplomatic optimism reduced near-term inflation concerns, while long-end weakness potentially reflected reduced geopolitical risk and improved growth expectations. T-note futures ticked higher across the curve into settlement, perhaps reflecting some month-end positioning. US data was broadly solid, with Durable Goods beating the headline forecast and the final University of Michigan report revised higher, while Fed officials continued to flag inflation concerns. In FX, the Dollar weakened while the Japanese Yen was the clear outperformer, with USD/JPY falling back below 157.00 after Trump called Yen weakness problematic, while Japanese PM Takaichi said the currency is undervalued and Finance Minister Katayama said she expects excessive Yen selling to be corrected. GBP, AUD, EUR and NZD also gained against the Dollar, while CAD and CHF marginally underperformed. Attention now turns to a key week for US data, including ISM Manufacturing, PCE and NFP, for further evidence on whether the strong growth, elevated inflation and solid labour market narrative remains intact. US Durable Goods Orders were virtually unchanged in August (exp. -0.4%, prev. +1.1%), outperforming expectations but slowing from July, with Transportation Equipment (-0.6%) driving the weakness. Excluding transportation, orders rose 0.3% (exp. +0.6%), while orders excluding defence increased 0.1%. More encouragingly, the closely watched Nondefense Capital Goods Orders ex-Aircraft, a proxy for business equipment investment, jumped 1.6% M/M (exp. +0.5%, prev. +0.2%), pointing to continued strength in underlying business investment. Pantheon Macroeconomics notes that real core shipments increased a more muted 0.3% in August but remain on track to rise at an annualised pace of just over 10% in Q3. Pantheon expects business equipment investment excluding volatile computer and transportation components to increase at roughly the same pace, while overall equipment
investment is tracking around 15% growth, boosted by another surge in computer-equipment spending. Overall, the headline report was broadly flat, but the underlying capital-goods data point to continued robust business investment, particularly in equipment and computers. Fed Member Hammack said the biggest risk with inflation is the formation of an inflationary mindset. The 2026 voter noted growth has held up well with the job market stable, though worries about demand-related pressure on inflation. Hammack believes capex will pressure inflation for a while, and underlying inflation is likely above target, albeit inflation expectations are ‘reasonably well’ anchored. She doesn’t see current Fed policy as restraining the economy except for housing. On bond yields, she says the rise is driven by several factors, including a good economic outlook, with AI investment demand competing for investors in the bond market. Elsewhere, Oil closed lower by 2.5% while Gold ended Friday’s session with a gain of 0.5%.
To mark my 3425th issue of TraderNoble Daily Commentary I am offering a special 2-Year Rate of Euro 2750 for my Platinum Service which includes 1 to 4 updated emails throughout the trading day to demonstrate this value, a monthly subscription over the same period would cost 4440 euro in total This offer represents a 38% discount and is open to both new and existing members. If anyone is interested in this offer can you please email me on bryan@tradernoble.com for details
For anyone following my Platinum Service it made 680 points on Friday and is now ahead by 6347 points for September after ending the month of August with a gain of 2645 points after closing July with a gain of 8031 points, after ending June with a new record of 10527 points after ending May with a loss of 1104 points, having ended April with a gain of 1730 points, after ending March with a massive gain of 9002 points, having closed February with a strong gain of 5482 points after ending January with a gain of 4757 points, having closed December with a gain of 2599 points, after ending the month of November with a gain of 4542 points, after ending October with a nice gain of 5110 points after closing September with a gain of 3774 points while ending August with a gain of 3362 points after closing July with a gain of 3753 points after closing June with a gain of 3530 points, having closed May with a gain of 3606 points, after closing April with a gain of 7685 points after closing March with a gain of 2254 points while closing February with a gain of 4180 points. January ended with a gain of 2768 points while 1997 points were gained in December. October ended with a gain of 2179 points, after closing September with a gain of 4402 points, following a loss of 301 points in August. July gained 1908 points while June saw a gain of 2074 points. The Platinum Service made a previous record 9619 points in October 2022. Since I started this New Platinum Service in June 2015 it has averaged a monthly gain of over 2300 points. I have a YouTube Channel which contains recent interviews I have given This can be viewed by clicking HERE Please subscribe to this for new interview notification
Equities
The S&P 500 closed 0.51% higher at a price of 7743.
The Dow Jones Industrial Average closed 478 points higher for a 0.93% gain at a price of 51,828.
The NASDAQ 100 closed 0.42% lower at a price of 30,608.
The Stoxx Europe 600 Index closed 0.35% higher.
This morning, the MSCI Asia Pacific closed 0.7% lower.
This morning, the Nikkei closed 0.21% lower at 66,227.
Currencies
The Bloomberg Dollar Spot Index closed 0.24% lower.
The Euro closed 0.09% higher at $1.1391.
The British Pound closed 0.21% higher at $1.3245.
The Japanese Yen rose 0.92% closing at $157.27.
Bonds
U.K.’s 10-Year Gilt closed 1 basis points higher at 5.36%.
Germany’s 10-Year Bund Yield closed 4 basis points higher at 3.61%
U.S.10 Year Treasury closed 7 basis points higher at 5.18%.
Commodities
West Texas Intermediate crude closed 2.58% lower at $92.17 a barrel.
Gold closed 0.46% higher at $4294.10 an ounce.
This morning on the Economic front we have German IFO Survey and the Euro-Zone Economic Bulletin at 9.00 am. Next, we have U.S. Weekly Jobless Claims and Building Permits at 1.30 pm. This is followed by New Home Sales at 3.00 pm and the Kansas City Manufacturing Index at 3.30 pm. Finally, we have a seven-year Treasury Auction at 6.00 pm which will be watched closely given the rise in yields this week.
Cash S&P 500
The bond market had a coronary this past week, with Treasury yields breaking out to near-two-decade highs. But guess what? This is not about inflation, which is really a one-trick pony regarding energy costs. At 2.33%, the 10-year TIPS breakevens are well within the range of the past half-decade — the same level as March 10th of this year, when the nominal 10-year yield was sitting at 4.15%. The entire +100-basis-point surge has been in the “real rate” or the term (“risk”) premium. Investors realise that there have been no second-round effects into core (where the YoY inflation pace is +2.4%) or wages — this is partly about the intensifying demand for capital coming out of AI that has bumped against structurally high government deficits and a general thumbs-down to government policy. And insofar as real rates have gapped up above the prevailing level of real GDP growth, this is deadweight drag on the real economy. We are now up to nearly four rate hikes being discounted for the coming year at a time when the yield curve was perilously close to inverting. That cannot be good news for the growth outlook. At the yield lows in late February, the markets were thinking at least one cut, so this is the mother of all shifts. But despite all the inflation chatter, it has not shown up in market-based expectations. As for this 2.85% real yield in the 10-year T-note, it is now the highest since November 2008. Cause for pause, to say the least. The coupons across the Treasury curve are appealing, but the issue is that investors have been scared off the bond market after this yield melt-up, and many of the so-called experts are calling for a further drift higher into a 5.25%-5.50% range, which is around where it got stopped out back in the summer of 2007. We all know what happened next, because the historical record shows that spasms in the bond market end up affecting all other asset classes with a bit of a lag. Forewarned is forearmed. TBD. My S&P plan worked well on Thursday/ Friday as after a nervous opening to Thursday the market eventually rallied to my 7716 revised exit level on my 7717 average long position. Subsequently, I emailed my Platinum Members to buy the S&P which I did on two occasions at 7690 – exiting at 7715 and again at 7695 before exiting this position at 7722 and I am now flat. Despite the huge rise in Treasury Yields the S&P is still less than 2% from all-time highs as the buy the dip continues to hoover up every dip. As long as the S&P does not break and close below the post FOMC low of 7507 then the S&P will continue to be a buy on dips. Today, I will be a buyer of the S&P from 7670/7695 with a 7649 ‘Closing Stop’. If I am taken long, I will have a T/P level at 7725. I still do not want to be short the market at this time.
EUR/USD
I am still long the Euro from last Thursday at a price of 1.1385. I will continue to look to add to this position at 1.1305 while leaving my 1.1245 ‘Closing Stop’ unchanged. Meanwhile, I will leave my 1.1470 T/P level unchanged. If any of the above levels are hit, I will be back with a new update for my Platinum Members
Dollar Index
The Dollar rallied to my 101.30 sell level. The Dollar is overbought and due a correction before again moving higher. I will add to this position at 102.10 while leaving my 102.75 ‘Closing Stop’ unchanged. I will now raise my T/P level to 100.70. If any of the above levels are hit I will be back with a new update for my Platinum Members.
Russell 2000
I am still long the Russell from last week at a price of 2850. I will add to this position at 2780 with the same 2725 ‘Closing Stop’. I will now lower my T/P level to 2895. If any of the above levels are hit, I will be back with a new update for my Platinum Members.
FTSE 100
The FTSE rallied to my 10740 T/P level on my latest 10700 long position and I am now flat. Today, I will again be a buyer from 10580/10660 with a lower 10495 ‘Closing Stop’. If I am taken long, I will have a T/P level at 10730.
Dow Rolling Contract
My ‘Nothing Matters’ theme continues as no matter what bad news is thrown at the market, buyers are programmed to keep buying dips until we get a meaningful break to the downside. With 10-Year Yields hitting 5.21% on Friday the Dow had every excuse to move lower. The Dow’s reversal on Friday saw the market hit my 51600 T/P level on my latest 51550 average long position and I am now flat. Today. I will again be a buyer from 51180/51480 with a lower 50995 ‘Closing Stop’. If I am taken long, I will have a T/P level at 51790.
Cash NASDAQ 100
The 10-year Treasury yield has broken the downtrend that dates back to 1987 and is now sitting just under 5.25%, the double top from 2006 and 2007. Get through that, and there is not much in the way until 5.50% and then 5.90%. The 30-year has already cleared its own level, and the triangle it is breaking out of measures to around 6.7% if it completes. Real yields are moving the same way, with the 10-year real yield closing in on 3% and the 5y5y forward telling you the market now sees neutral much higher than anything we have seen in the past 20 years. That makes this week’s data unusually important. JOLTS on Tuesday, PCE and the final GDP revision on Wednesday, ISM manufacturing on Thursday, the September jobs report on Friday, and Micron in between. Strong prints reinforce the move in bonds. The last S&P Global PMI alone sent the 10-year up 15 basis points in a day. Meanwhile, the equity market is not pricing any of it. Bond volatility has exploded, and the VIX is still under 15. Implied correlation is near record lows, which means there is almost no room for the VIX to fall from here even in the best case. The asymmetry is skewed one way, and it is not the way the NDX’s new highs suggest. Beneath the index, the equal-weight, the Russell, and even the Dow are all telling a different story. The NDX rallied to my revised 30315 T/P level on my latest 30230 long position and I am now flat. The NDX has support below at 28700 while the real support level comes in at a price 27300 which is the July low. The market needs to break and close below these two key support levels before we can look for a more sustained move lower. I always respect price action and the market is saying that so far rising Treasury Yields have had no real effect on the market. Today, I will be a buyer of the NDX from 30080/30280 with the same 29895 ‘Closing Stop’. If I am taken long, I will have a T/P level at 30510. I still do not want to be short the NDX at this time.
December BUND
I am still long Bund at an average rate of 120.40 with the same 119.45 ‘Closing Stop’. I will now lower my T/P level to 120.60 and reassess if triggered. If any of the above levels are hit, I will be back with a new update for my Platinum Members.
Gold Rolling Contract
The Precious Metals were hit hard overnight. This move lower saw Gold hit my buy range for a now 4220 long position. I will add to this position at 4150 while leaving my 4075 ‘Closing Stop’ unchanged. I will now lower my T/P level to 4295. If any of the above levels are hit, I will be back with a new update for my Platinum Members.
Silver Rolling Contract
Overnight, Silver hit my second buy level at 62.00 for a now 63.30 average long position. Silver is oversold and due a rally. I will leave my 59.95 ‘Closing Stop’ unchanged while lowering my T/P level to 64.80. If any of the above levels are hit, I will be back with a new update for my Platinum Members
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