A week that looked set up for a risk-off finish ended the other way. With the 10-year Treasury yield parked near 5.18%, its highest since 2007, US stocks still closed Friday higher, crude oil backed away from its Thursday spike on reports of a possible Strait of Hormuz deal, and gold slipped for the week as rising yields and a firmer dollar kept pressure on bullion. Here is how futures, stocks, oil and gold finished, and what the cross-asset picture says heading into October.
Stocks: a winning week despite the bond market
Friday's cash closes, 25 September:
The small-cap index going nowhere is worth noticing. Smaller companies carry more floating-rate debt and feel higher borrowing costs first, so a flat Russell alongside a rising Nasdaq is a sign that the market is rewarding balance-sheet strength and AI exposure, not taking on risk across the board.
Mega-cap tech did the heavy lifting. Meta has been the standout of the month on the back of its Muse AI assistant, which went to the top of the app store charts and pulled in analyst upgrades, making September one of the stock's strongest months in years. Costco beat earnings expectations, while Nike slid after a downgrade to Underperform.
The backdrop was not friendly. The S&P Global flash composite PMI jumped to 58.4 in September, the fastest pace of private-sector growth since mid-2021, and the manufacturing gauge came in at 57.0 against expectations near 53.6. Strong growth sounds bullish, but in this environment it mostly reinforced the case for more Fed tightening, which is part of why yields kept climbing this week. At the same time, the University of Michigan's final consumer sentiment reading fell to 48.1, with households pointing to fuel prices. Businesses are running hot while consumers feel squeezed.
Oil: deal hopes versus supply shocks
Crude spent the week whipsawing on Middle East headlines. Brent traded as high as about $108 on Thursday before reports that US and Iranian negotiators were exploring a phased deal to reopen the Strait of Hormuz took the edge off the rally. On Friday, US crude (WTI, November contract) fell roughly 2% to around $92.50, leaving it down about 7% on the week.
The risks have not gone away. Houthi missiles were fired toward Saudi Arabia on Thursday, and Saudi Arabia's East-West pipeline, the main route that lets Saudi crude bypass Hormuz, has been shut since drone attacks earlier this month. Iran has also said it will not accept a deal unless the US eases military pressure. Expect crude to keep trading as a headline market: sharp drops on progress in the talks, sharp jumps on any new attack.
Gold: yields win this round
Gold futures edged up about 0.5% on Friday to roughly $4,320, but spot gold was on track for a weekly loss of around 2%. The logic is straightforward: gold pays no interest, so when Treasury yields and the dollar rise together, the cost of holding it goes up. With the market now pricing at least one more Fed hike this year, bullion has struggled to hold rallies even with a war in the background.
Watch the relationship between gold and inflation-adjusted yields. If oil falls on a Hormuz deal, inflation expectations should ease, but so would the case for further hikes. That combination could actually help gold, because real yields would stop rising.
What futures traders should note
The week ahead
The start of October brings the US jobs report and the ISM surveys, and after this week's PMI, a strong payrolls number would add to the case for another Fed hike. Oil headlines out of the New York talks will remain the biggest wildcard for every asset on this list.
The bottom line
Stocks proved they can rise with 5% yields, but only in narrow, quality-heavy leadership. Oil is caught between peace-deal hopes and real supply damage. Gold is being held back by rising yields. As long as crude and the long end of the bond market stay volatile, size positions for larger swings and treat every Hormuz headline as a potential cross-asset event.
Stocks: a winning week despite the bond market
Friday's cash closes, 25 September:
- S&P 500: 7,743.41, up 0.51% on the day and about 1.2% on the week.
- Nasdaq Composite: 27,068.72, up 0.48% on the day and about 2% on the week.
- Dow Jones Industrial Average: 51,828.62, up 478.64 points (0.93%), snapping a three-week losing streak.
- Russell 2000: roughly flat at 2,837.55.
- VIX: eased to about 14.9.
The small-cap index going nowhere is worth noticing. Smaller companies carry more floating-rate debt and feel higher borrowing costs first, so a flat Russell alongside a rising Nasdaq is a sign that the market is rewarding balance-sheet strength and AI exposure, not taking on risk across the board.
Mega-cap tech did the heavy lifting. Meta has been the standout of the month on the back of its Muse AI assistant, which went to the top of the app store charts and pulled in analyst upgrades, making September one of the stock's strongest months in years. Costco beat earnings expectations, while Nike slid after a downgrade to Underperform.
The backdrop was not friendly. The S&P Global flash composite PMI jumped to 58.4 in September, the fastest pace of private-sector growth since mid-2021, and the manufacturing gauge came in at 57.0 against expectations near 53.6. Strong growth sounds bullish, but in this environment it mostly reinforced the case for more Fed tightening, which is part of why yields kept climbing this week. At the same time, the University of Michigan's final consumer sentiment reading fell to 48.1, with households pointing to fuel prices. Businesses are running hot while consumers feel squeezed.
Oil: deal hopes versus supply shocks
Crude spent the week whipsawing on Middle East headlines. Brent traded as high as about $108 on Thursday before reports that US and Iranian negotiators were exploring a phased deal to reopen the Strait of Hormuz took the edge off the rally. On Friday, US crude (WTI, November contract) fell roughly 2% to around $92.50, leaving it down about 7% on the week.
The risks have not gone away. Houthi missiles were fired toward Saudi Arabia on Thursday, and Saudi Arabia's East-West pipeline, the main route that lets Saudi crude bypass Hormuz, has been shut since drone attacks earlier this month. Iran has also said it will not accept a deal unless the US eases military pressure. Expect crude to keep trading as a headline market: sharp drops on progress in the talks, sharp jumps on any new attack.
Gold: yields win this round
Gold futures edged up about 0.5% on Friday to roughly $4,320, but spot gold was on track for a weekly loss of around 2%. The logic is straightforward: gold pays no interest, so when Treasury yields and the dollar rise together, the cost of holding it goes up. With the market now pricing at least one more Fed hike this year, bullion has struggled to hold rallies even with a war in the background.
Watch the relationship between gold and inflation-adjusted yields. If oil falls on a Hormuz deal, inflation expectations should ease, but so would the case for further hikes. That combination could actually help gold, because real yields would stop rising.
What futures traders should note
- Index futures premiums are bigger than they used to be. E-mini S&P futures traded around 7,786 overnight, above Friday's cash close. Part of that gap is simply the cost of carry: with short-term rates near 4% and dividend yields far lower, the fair-value premium of futures over cash is wider than it was when rates were near zero. Account for fair value before reading an overnight futures move as a signal.
- WTI is lagging Brent. Brent has held a double-digit dollar premium over WTI, among the widest spreads in months, because the supply risk sits in the Gulf rather than in the US. Spread traders should expect that gap to narrow quickly on any credible reopening of Hormuz.
- Treasury futures are the main driver. The 30-year yield hit its highest level since 2004 this week. Hawkish comments from Fed Governor Michael Barr, the hot PMI data and high energy prices all fed the move. Equity and gold futures are reacting to bond moves in real time, so keep the 10-year on your screen.
The week ahead
The start of October brings the US jobs report and the ISM surveys, and after this week's PMI, a strong payrolls number would add to the case for another Fed hike. Oil headlines out of the New York talks will remain the biggest wildcard for every asset on this list.
The bottom line
Stocks proved they can rise with 5% yields, but only in narrow, quality-heavy leadership. Oil is caught between peace-deal hopes and real supply damage. Gold is being held back by rising yields. As long as crude and the long end of the bond market stay volatile, size positions for larger swings and treat every Hormuz headline as a potential cross-asset event.
clean
by ai-agent
— Support market news pair, user-directed 2026-09-25