Commodities and cash were the only winners among the major asset classes in September. The rest of the field lost ground, led by property shares in the U.S. and around the world, based on a set of ETFs.
Treasury Yields Keep Rising. Can the Economy Keep Up?
One of the more persuasive explanations for the recent increase in U.S. Treasury yields is that the economy remains resilient, prompting the bond market to push interest rates higher in response to a stronger growth outlook. Recent third-quarter GDP nowcasts support that narrative. The catch is that higher interest rates may be a double-edged sword: while they can signal economic strength, they can also undermine it by creating headwinds for future growth. The growth narrative may be convincing, but it is unlikely to be the whole story. Some of the other factors driving yields higher paint a less reassuring picture.
Tomorrow’s PCE Inflation Report May Boost Fed Hike Bets
Wednesday’s release of August PCE inflation data is expected to reinforce expectations that the Federal Reserve will raise interest rates again. The bond market is signaling a similar outlook as key Treasury yields continue to test recent highs.
What Does Today’s Yield Curve Suggest for a Bond Ladder?
US Treasury yields continued to rise last week, and the trend profile suggests we haven’t seen the peak yet. The benchmark 10-year yield, for example, increased for a fourth straight week, closing on Friday at 5.16%, just below the highest level since 2007.
Book Bits: 26 September 2026
● The Madness of Markets: Why Smart Investors Make Crazy Decisions–and How to Exploit Them
Alex Edmans
Review via Publishers Weekly
“Sometimes, the most rational thing a researcher can do is study the irrational,” contends London Business School finance professor Edmans (May Contain Lies) in this enlightening exploration of the psychological forces that drive financial market decisions. Edmans notes that even Isaac Newton fell victim to stock market frenzy, losing millions of pounds in a 1720 foray into South American ventures and lamenting that he could “calculate the movement of the stars, but not the madness of men.” Edmans offers examples of such madness, explaining how the weather, celebrity hype, and even the performance of a country’s soccer team skew investor behavior. Sometimes market decisions seem sound but are based on irrational biases, he adds.
Treasury Yield Surge Pressures Rate-Sensitive Shares
Treasury yields continued to rise on Thursday, reaching new multi-decade highs. The increase, which enhances the appeal of bonds, is starting to weigh on stocks. So far, the pressure on equities has been relatively mild, although the pain has been more intense for some slices of interest rate-sensitive shares, which have lost substantially more ground in recent weeks than the broader market, based on a set of ETFs through Thursday’s close.
Fed on Track for Second Rate Hike Just Ahead of Elections
Wall Street has been on alert for more policy tightening after the Federal Reserve lifted its target rate last week for the first time in three years. But the view on timing was hazy, until yesterday.
The Path to Lower Inflation Still Runs Through Iran
Absent the Iran conflict, U.S. inflation would likely be lower and probably trending down for some measures of pricing pressure. The problem, of course, is that the odds still appear low for a quick end to the crisis, although there’s renewed hope that the hostilities may be entering a less-volatile phase. If the war is transitioning toward a lower-intensity stage, that could help tame inflation in the months ahead, which could limit the number of Federal Reserve’s interest-rate hikes.
AI Optimism Returns, Pushing Inflation Risks Into the Background
Investors appeared poised to refocus on rising interest rates last week and related fallout for stocks. Then came Meta’s latest AI unveiling, which helped revive the market’s preferred mantra: strong AI-driven earnings growth can overcome virtually any macro challenge.
US Economy Picks Up in Q3 as Rising Rates Threaten Momentum
The US economy continues to show signs of rebounding in the third quarter after downshifting in Q2, according to several GDP nowcasts. Rising interest rates cloud the outlook for the year’s final quarter and beyond, but next month’s release of the Q3 GDP report is expected to show a solid pickup in output.