Markets Edge Higher as Oil Prices Ease, Retail Sales Beat Expectations

The S&P 500 Index ($SPX) (SPY) rose +0.18% today, the Dow Jones Industrial Average ($DOWI) (DIA) declined -0.23%, and the Nasdaq 100 Index ($IUXX) (QQQ) gained +0.68%. E-mini S&P futures (ESU26) are up +0.29%, and September E-mini Nasdaq futures (NQU26) are up +0.68%.

Stock indexes traded in mixed fashion, with the broader market pushing higher as falling crude oil prices helped lower bond yields and improve overall sentiment. Crude oil retreated after weekly API data released late Tuesday showed US crude inventories surged by +7.1 million barrels last week, with gasoline and distillate inventories also expanding. The EIA is scheduled to release its weekly petroleum inventory report later today. Equities built on early gains following stronger-than-expected US retail sales data for August.

Chipmakers rallied today to support broader market gains, with Intel rising more than +6% following reports that the company was in talks with South Korean chipmaker SK Hynix to produce memory chips in the US for the first time.

US MBA mortgage applications fell -4.1% in the week ended September 11, with the purchase mortgage sub-index down -0.8% and the refinancing sub-index down -8.8%. The average 30-year fixed-rate mortgage rate climbed +12 bp to a 15-month high of 6.97%, up from 6.85% the prior week.

US August retail sales rose +1.2% month-over-month, exceeding expectations of +0.8% and marking the largest monthly increase in five months. Retail sales excluding autos gained +1.4% m/m, above expectations of +0.6% m/m.

The Federal Reserve is widely expected to raise interest rates later today for the first time since 2023, as inflation pressures remain above the central bank’s 2% target. The Federal Open Market Committee (FOMC) is anticipated to lift the fed funds target range by +25 bp to a range of 3.75%–4.00% and release updated economic forecasts and rate projections. Attention will also turn to comments from Fed Chair Warsh at the post-meeting press conference.

October WTI crude oil futures (CLV26) are down more than -2% today after the weekly API report late Tuesday showed US crude inventories rose by +7.1 million barrels last week. Crude prices had surged to a 3.75-month high on Tuesday as persistent disruptions to Middle East supplies continued to tighten global oil supplies. Last Friday, Saudi Arabia shut down a major pipeline following attacks, disrupting a key route that bypasses the Strait of Hormuz. The East-West pipeline, which transports 7 million bpd of crude, was closed after threats from Houthi rebels, and officials have provided no indication of when it will reopen. Saudi Arabia told OPEC last Thursday that its crude production in August fell to 6.238 million bpd, the lowest level since 1990.

Markets are pricing in a 94% probability of a +25 bp Fed rate hike at the conclusion of today’s FOMC meeting.

Overseas stock markets finished higher today. The Euro Stoxx 50 is up +0.60%. China’s Shanghai Composite recovered from a six-week low and closed up +0.71%. Japan’s Nikkei-225 Stock Average closed up +0.69%.

Interest Rates

December 10-year T-notes (ZNZ6) are up by +5 ticks today. The 10-year T-note yield is down -2.5 bp to 4.977%. Treasury notes moved higher today as WTI crude oil declined more than -2%, dampening inflation expectations. Additionally, some position squaring ahead of the FOMC meeting results later today supported gains in T-note prices.

T-note prices pulled back from their best levels after US August retail sales came in stronger than expected. Gains in T-notes are also being limited by expectations that the Fed will raise interest rates by +25 bp at the conclusion of today’s FOMC meeting and may adopt a hawkish posture going forward.

European government bond yields trended lower today. The 10-year German bund yield fell -1.0 bp to 3.528%. The 10-year UK gilt yield declined -7.2 bp to 5.315%.

Eurozone July industrial production fell -0.1% m/m, a smaller decline than the expected -0.2% m/m.

UK August CPI rose +3.1% y/y, in line with expectations and marking the largest increase in five months. August core CPI was unchanged from July at +2.6% y/y, matching forecasts.

Markets are pricing in a 54% chance of a +25 bp ECB rate hike at the ECB’s next meeting on October 29.

US Stock Movers

Chipmakers and AI stocks moved higher today, led by a +4% rally in Intel (INTC) following reports that the company is in talks with South Korean chipmaker SK Hynix to produce memory chips in the US for the first time. Marvell Technology (MRVL) was up more than +4%, and Advanced Micro Devices (AMD), ARM Holdings Plc (ARM), and Western Digital (WDC) each gained more than +3%. In addition, ASML Holding NV (ASML), KLA Corp (KLAC), Microchip Technology (MCHP), Applied Materials (AMAT), Lam Research (LRCX), Seagate Technology Holdings Plc (STX), and Texas Instruments (TXN) were all up more than +1%.

JB Hunt Transport Services (JBHT) fell more than -11% to lead trucking companies lower and rank among the biggest losers in the S&P 500 after the company said it expects Q2 to Q3 earnings to decline -5% to -10%. Also, FedEx Freight Holding (FDXF), Knight-Swift Transportation Holdings (KNX), and ArcBest (ARCB) were down more than -3%, while Old Dominion Freight Line (ODFL) and Marten Transport Ltd (MRTN) were down more than -2%. In addition, Saia Inc (SAIA), CH Robinson Worldwide (CHRW), United Parcel Service (UPS), and XPO Inc (XPO) were down more than -1%.

Energy stocks and service providers declined today alongside WTI crude oil, which was down more than -2%. Diamondback Energy (FANG) dropped more than -7% to lead losers in the Nasdaq 100, and APA Corp (APA) was down more than -4%. ConocoPhillips (COP), Devon Energy (DVN), and Occidental Petroleum (OXY) were each down more than -3%, and ExxonMobil Holdings (XOM) was down more than -2%. In addition, Chevron (CVX) and Slb Limited (SLB) were down more than -1%.

FTAI Aviation Ltd (FTAI) rose more than +2% after announcing a $500 million stock repurchasing plan.

Expedia Group (EXPE) declined more than -2% after Morgan Stanley downgraded the stock to underweight from equal weight with a price target of $235.

Huntington Bancshares (HBAN) was down more than -1% after cutting its 2027 EPS estimate to $1.75–$1.83 from a prior April outlook of $1.90–$1.93.

Earnings Reports (9/16/2026)

Aeluma Inc (ALMU), and Lennar Corp (LEN).

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