Weekly market analysis: employment, oil, and technology

Weekly market analysis: employment will decide between earnings and rates: Weekly market analysis:

weekly market analysis: updated analysis with context for investors.

Weekly market analysis:: updated analysis with context for investors.

The weekly market analysis shows firm indexes, but uneven participation and a demanding valuation versus the US Treasury.

• 📊 Nasdaq gained 2.06% for the week and closed Friday at 27,068.72 points.
• 💵 The 10-year Treasury ended at 5.18%, reducing the relative appeal of equities.
• 🛢️ Brent closed at $97.73 after fluctuating between $96.39 and $108.23 during the last two sessions.

What happened this week

Indexes rise, but small caps lose participation

The S&P 500 closed on Friday, September 25, at 7,743.41 points, with a weekly gain of 1.21%. The official close was at 22:00 CEST, 14:00 in Mexico City.

The Nasdaq Composite ended at 27,068.72 points, up 2.06% for the week. Its close also corresponded to 22:00 CEST, 14:00 in Mexico City.

The Euro Stoxx 50 finished at 6,298.15 points, up 0.99% for the week, at 17:30 CEST. The IBEX 35 ended at 19,700.10 points, up 0.95%, at 17:35 CEST.

The technical reading keeps the S&P 500 between support at 7,650.50 and weekly resistance at 7,782.19. Breaking above that resistance would extend the move toward 8,000 points.

Nasdaq holds support at 26,522.54 and meets supply at 27,288.79. Nvidia and the semiconductor complex continue to determine the index’s slope.

Breadth offers a more cautious signal. The Russell 2000 fell 0.80% for the week, to 2,837.55 points, while the S&P 500 advanced 1.21%.

The Russell 2000/S&P 500 ratio fell from 0.3739 to 0.3664, a weekly contraction of 1.99%. The VIX closed at 14.87 points.

The combination reflects concentration in large caps. It does not invalidate the advance, but it increases dependence on Nvidia, Microsoft, Amazon, and other technology companies.

In Europe, 6,236.20 points act as support for the Euro Stoxx 50. The IBEX holds 19,513.80 as a reference, with 19,819.10 as first resistance.

The labor market is holding up better than expected

Initial jobless claims fell to 197,000, versus 201,000 expected. The prior reading stood at 198,000 claims.

Durable goods orders increased 1.1% month-on-month in August. The consensus expected a 0.4% decline, signaling that business investment is still resilient.

Both data points reinforced the perception of solid activity. They also limited the possibility of rapid monetary easing after the tightening delivered by the Federal Reserve.

A firm labor market protects consumption and bank earnings. However, higher rates for longer pressure housing, consumer credit, and growth valuations.

For Santander and BBVA, an elevated curve supports net interest margins. Profitability also depends on non-performing loans, credit quality, and the stability of sovereign spreads.

Inditex is supported by still-resilient demand. Its margin elasticity will depend on logistics costs, currencies, and the ability to maintain prices.

Expensive bonds, firm gold, and oil shaped by Hormuz

EUR/USD ended Friday at 1.1392 dollars per euro. The European currency retains technical support at 1.1300 and immediate resistance at 1.1450.

Brent closed at $97.73 per barrel, versus $103.87 the previous week. The weekly decline was 5.91% despite regional tension.

Gold ended at $4,320.50 per ounce. Its strength is notable against a 5.18% yield on the US 10-year Treasury.

The S&P 500 trades at 21.2 times the 2026 EPS of $365 estimated by Barclays. On the $425 forecast for 2027, the multiple falls to 18.2 times.

Using the 2026 P/E, the implied earnings yield reaches 4.71%. Subtracting the 5.18% Treasury, the ERP stands at -0.47 percentage points.

That negative ERP indicates an insufficient premium versus government debt. Earnings need to beat forecasts to justify further multiple expansion.

Iberdrola retains defensive qualities and exposure to networks. Its valuation remains sensitive to the cost of debt, especially with long US rates above 5%.

Gold offers protection against energy inflation and political risk. Brent maintains an asymmetric distribution, because any logistical disruption could quickly reverse its decline.

What could move markets next week

Micron and Carnival will gauge technology, investment, and consumption

Carnival will report results on Tuesday, September 29, before 15:30 CEST, 07:30 in Mexico City. The market will watch bookings, pricing, and fuel.

Micron will release earnings on Wednesday, September 30, after 22:00 CEST, 14:00 in Mexico City. Its guidance will affect memory, servers, and artificial intelligence.

Micron will be the reference point for Nvidia, ASML, and data center suppliers. Memory pricing, inventories, and capital spending will matter.

Carnival will provide information on discretionary consumption. Solid demand does not guarantee better margins if fuel, wages, and financing absorb revenue growth.

Base case (55%): Micron meets forecasts and Carnival confirms stable bookings; Nasdaq consolidates above 26,900 and Inditex maintains relative strength. Bullish scenario (25%): Micron raises guidance and reactivates buying in Nvidia and ASML; Nasdaq breaks above 27,288.79. Adverse scenario (20%): weak margins or lower capex pressure semiconductors and consumption.

The reaction will matter more than the reported profit. With demanding multiples, guidance that is merely in line may trigger profit-taking.

PCE and employment will define the next move in rates

August core PCE will arrive on Wednesday, September 30, at 14:30 CEST, 06:30 in Mexico City. The consensus expects 0.3% month-on-month.

The annual core rate would stand at 3.2%, versus the previous 3.3%. A moderate decline would not remove pressure coming from energy and wages.

On Friday, October 2, also at 14:30 CEST, 06:30 in Mexico City, the September nonfarm payrolls will be published.

The latest consensus points to 100,000 jobs, versus the previous 162,000. The unemployment rate could rise from 4.1% to 4.2%.

Base case (50%): core PCE at 3.2% and employment near 100,000; the S&P 500 fluctuates between 7,650 and 7,820. Bullish scenario (30%): inflation and wages surprise to the downside; the Treasury falls and Nasdaq, gold, and Iberdrola rebound. Adverse scenario (20%): strong employment and higher inflation; the Treasury rises above 5.25% and compresses multiples.

For Latin American stock markets, a moderate dollar would ease financing conditions and support flows. A rise in US rates would pressure currencies, local debt, and leveraged companies.

Hormuz keeps the geopolitical oil premium alive

The conflict among the United States, Israel, and Iran will continue to command attention. The market will assess sanctions, maritime security, and the Gulf’s export capacity.

The key reference will be the continuity of traffic through the Strait of Hormuz. The recovery of Saudi Arabia’s East-West pipeline also matters, as a partial alternative for exports.

Brent rose above $108 during the regional escalation. A further blockade could send it back above that level and closer to $115.

A ten-dollar increase would add inflationary pressure and reduce disposable income. Airlines, transport, and consumption would suffer, while oil companies and gold would gain relative appeal.

Base case (55%): irregular but operational traffic; Brent between $94 and $105, with Repsol firm and consumption contained. Bullish scenario (20%): diplomatic progress reduces the premium; Brent falls below $94 and the Euro Stoxx 50 improves. Adverse scenario (25%): new sanctions or attacks push Brent toward $115 and gold above $4,400.

European banks would face mixed effects. Higher inflation would support rates, but it would increase non-performing loans, weaken credit, and widen sovereign spreads.

Conclusion

The base case maintains a moderately positive tilt, although it requires discipline on entry prices. The S&P 500 and Nasdaq retain upward structures above 7,650.50 and 26,522.54 points. The signal loses quality because the Russell 2000 is not confirming and the 2026 ERP remains at -0.47 points. It makes sense to prioritize companies with visible growth, solid cash generation, and the ability to defend margins. Nvidia and ASML need to validate the investment cycle through Micron’s guidance. Santander and BBVA can sustain earnings with high rates, as long as non-performing loans and spreads remain under control. Inditex offers operational quality, but it faces sensitivity to consumption, logistics, and currencies. Iberdrola provides stability, although a US yield above 5.25% would raise its relative cost of capital.

The thesis would be invalidated if the S&P 500 loses 7,650.50 points and the Nasdaq closes below 26,522.54. A simultaneous break with the VIX above 20 would confirm technical deterioration. The scenario would also change with Brent above $115 or a Treasury sustained above 5.25%. In that case, I would reduce exposure to unprofitable growth and leveraged consumption. Gold works as a hedge against inflation, conflict, and the loss of monetary confidence. Cash in dollars and short-duration bonds offer defense against volatility spikes. A selective position in energy hedges against oil disruptions. For European portfolios, regulated utilities provide stability, but they should be combined with short maturities. Next week requires watching employment, inflation, and corporate guidance before increasing risk.

This article is general financial information and does not constitute investment advice.

Keep reading on the blog: Wall Street today: the Dow leads and crude eases and Wall Street today: bearish close due to rates and oil.