Stocks Up Early, Led by Tech, as AI Dominates News
Published as of: September 29, 2026, 9:13 a.m. ET
(Tuesday market open) Stocks edged up early before the opening salvo of this week's data parade. Tech led the way as investors mulled Anthropic's prospectus and OpenAI halting release of its next-generation AI model due to safety concerns. Treasury yields and oil both slipped, a positive backdrop.
While yield and oil concerns are a constant drumbeat, so is data, beginning with the August Job Openings and Labor Turnover Survey (JOLTS) at 10 a.m. ET. Analysts expect 7.2 million, barely below July's. "If the labor market remains stable, it just takes pressure away from that side of the mandate and allows the Fed to focus more on inflation," said Collin Martin, head of fixed income research and strategy at the Schwab Center for Financial Research (SCFR). Nonfarm payrolls arrive Friday, and consensus for September jobs growth is 84,000, about half of August's tally.
Major indexes flopped Monday, burdened by rising Treasury yields as rate hike odds stayed firm. Odds of an October Federal Reserve rate hike stood at 70%, according to the CME FedWatch Tool, with 58% chances of another in December. Higher rates would raise borrowing costs for AI "hyperscalers" that have contributed to firm economic growth sparking inflation, but the Fed might have its hands full trying to slow that train.
Three things to watch
- First look at data isn't last word: The data procession that starts with JOLTS isn't necessarily the final word. Though metrics like the unemployment rate and inflation can move stocks simply by coming in tenths of a percentage point away from estimates, the numbers aren't precise measurements because the economy is simply too big to measure. That's why many statistics get revised as more information becomes available. This doesn't mean the data is inaccurate, but it does mean investors would be wise not to focus too much on any single data point. The August nonfarm payrolls report showing more than 160,000 jobs created, three times consensus, is a case in point. This helped spark the Treasury yield rally but could be revised Friday. The three-month average nonfarm payrolls growth of 71,000 smooths out the data, giving investors a better sense of what's happening beyond snapshots that can get changed. Before that, tomorrow morning's August Personal Consumption Expenditures (PCE) price index is seen up 0.3% monthly and 3.4% annually for core excluding food and energy. A Fed policymaker said last week he'd like to see 0.2% or less core monthly PCE growth.
- Fed speakers bureau: Despite the sharp yield rally, the term premium—or the extra compensation investors demand for buying longer-term debt—hasn't moved much. That suggests fiscal concerns that often drive term premium higher aren't necessarily the main factor. Instead, the rally appears driven by changing perspectives around Fed policy. Odds of higher rates began to flatten the yield curve recently. This can indicate rising recession odds, though past isn't precedent. Coming days provide 20 speaking events from policymakers, many about the economic outlook. Fed Gov. Michael Barr gets things started at 12:40 p.m. ET today, followed by three more speakers tomorrow. Investors might want to hear how they equate strong economic growth with rising prices. "So far, sticky inflation has not been enough to derail key drivers of economic growth," said Kevin Gordon, head of macro research and strategy at SCFR, who noted solid private sector investment as core capital goods shipments grew 11.5% year-over-year in August. "Not only that, but layoff activity has been dormant," he added. Thursday brings September layoffs data, while tomorrow's August personal spending number also looks key.
- 10-year yield approaches milestones: The 10-year Treasury note yield clawed above 5.25% yesterday. More interesting would be a move above the 2007 high of 5.32% or the 2002 high of 5.47%. The last time the 10-year traded above 6% was in August 2000 after peaking above 6.8% at the very turn of the century. Though 2000 and 2007 are not years veteran stock traders remember fondly considering what happened next, stocks have taken the current move relatively well. However, that's at the index level. Lower down, there's churn as sectors like utilities, transports, financials, and real estate grapple with rising borrowing costs. Yields reflect instability around the world, oil, and government deficits. Rising rates make it harder for governments to fund interest payments, and there's no sign of any economic slowdown or government spending speed bumps that might ease pressure. It might take a truly dismal September jobs report to put even a temporary brake pedal on yields. The consensus is for jobs creation of 85,000.
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On the move
- Despite fresh AI concerns on OpenAI's decision to halt its latest ChatGTP model due to worries about safety, AI infrastructure and chip stocks generally rose early today, though not by a lot. Arm Holdings (ARM), Applied Materials (AMAT), ASML (ASML), and Micron (MU) were among the initial leaders.
- Advanced Micro Devices (AMD) rose 1.4% in early trading after buying AI start-up World Labs for $8.2 billion. World Labs develops AI software that runs physical world applications, Bloomberg reported.
- Anthropic's prospectus showed the company expects to spend more than half a trillion dollars on cloud, computing, and infrastructure in coming years, Reuters reported. It had a net loss of $42 billion last year on revenue of nearly $4.6 billion. The prospectus also warned that AI models pose a "catastrophic or existential risk to humanity." The initial public offering (IPO) could value the company at more than $2 trillion.
- Oura, a health intelligence platform and maker of a smart ring, announced it's postponing its previously announced IPO due to uncertainty in the IPO market.
- SpaceX (SPCX) rose 1% early after successfully launching its Starship to orbit Monday. However, the ship only made it through two orbits instead of the six planned due to engine problems at launch.
- Bloomin' Brands (BLMN) popped 6% this morning after the restaurant chain got an upgrade to neutral by JPMorgan Chase, which previously rated the firm underweight.
- Carmax (KMX) surged 5% as earnings impressed.
- Summit Therapeutics (SMMT) climbed 18% early as Reuters reported AstaZeneca (AZN) would invest $2 billion in the company and collaborate on cancer studies.
- Energy shares lost ground early as oil prices dipped on reports of indirect talks between Iran and the U.S. Oil came off highs yesterday on reports of rising crude exports from the Middle East. Shipments reached 80% of pre-war levels last week, The Wall Street Journal reported.
- The Cboe Volatility Index (VIX) rose 8% Monday but dipped below 16 early today, not showing signs of immense hedging demand despite rising yields.
More insights from Schwab
Fed toolbox examined: Though rate hikes target demand, supply is driving inflation and may be less rate-sensitive, our new analysis found. Cyclical inflation—the type driven by economic strength and demand—is sensitive to higher rates. But acyclical inflation from supply problems or industry costs, isn't, and that's outpacing cyclical inflation.
What's next for the labor market? U.S. jobs growth drastically improved over the last few months after stumbling when the war began. However, investors might want to focus more on layoff data, noted my colleague Gordon, in his new Week Ahead video. Jobless claims remain light, partly due to immigration and age trends. It's been more beneficial to look at how much companies are laying off individuals, rather than just outright hiring activity.
Geopolitical fragmentation and investing: Globalization is being reorganized around security and resilience, a trend that's redirecting trade, investment, technology, and supply chains. Globalization isn't ending, but its structure is changing. This may strengthen the case for diversification and more active positioning across countries, sectors, and companies as investment opportunities shift.
Chart of the day
Data source: Cboe. Chart source: thinkorswim® platform.
Past performance is no guarantee of future results.
For illustrative purposes only.
It takes a long-term chart, in this case 30 years, to show the last time 10-year Treasury note yields (TNX:CGI—candlesticks) were testing some of the levels they are now. Though the 19-year high of 5.32% (red line) is just above current levels, one has to go back to early 2000, the era of Y2K, to find yields above 6% (blue line).
The week ahead
September 30: ADP September employment change, August PCE prices, second quarter GDP-third estimate, and expected earnings from Micron (MU), Conagra (CAG), and Levi Strauss & Co. (LEVI).
October 1: August construction spending, September ISM Manufacturing PMI®, S&P Global final September U.S. Manufacturing PMI, and expected earnings from Accenture (ACN), McCormick & Company (MKC), and Nike (NKE).
October 2: September nonfarm payrolls, September unemployment, and August factory orders.
October 5: September ISM Services PMI®.
October 6: Expected earnings from RPM International (RPM) and Constellation Brands (STZ).
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