Looking Ahead: August 31, 2026

The stock market was slapped lower Friday after a hawkish speech from Federal Reserve Chairman Kevin Warsh, but major indexes notched weekly gains.

Investors digested ongoing developments in the Middle East, U.S. – Canada trade negotiations, as well as the intervention in the Treasury market by the administration.

In an attempt to keep long term rates down, Treasury Secretary Bessant’s intervention doubled the amount of long-term Treasury bonds to be purchased by the U.S. Treasury Department. This is a few weeks after he intervened in the foreign exchange markets to attempt to stabilize the Japanese Yen.

The Nasdaq Composite slipped 0.5% Friday, but still carved out a weekly lift of 0.8%. Importantly, it managed to hold clear of the 21-day exponential moving average after retaking the level Thursday. The tech-heavy index now holds a hearty 13.6% gain for 2026.

The S&P 500 reversed lower as it gave up 0.3% for the day. It made its third weekly gain in the past four weeks thanks to a 0.5% rise. It is clear of its short-term moving averages and its 50-day line, a positive. The benchmark index is up 12.7% for the year so far.

It was a week that featured two big potential hurdles — Nvidia earnings and Warsh’s speech at the Kansas City Fed’s Economic Policy Symposium in Jackson Hole, Wyo.

While the first acted as a booster for stocks, the latter sent shares tumbling. Warsh saying persistently high inflation had become “more concerning” raised fears that a rate hike could be coming sooner rather than later. He also said the central bank’s “predominant focus” should be on price stability.

In economic news, the headline and core Personal Consumption Expenditures (PCE) inflation indexes, came in largely as expected. Personal income and spending were both stronger than expected, and second-quarter (Q2) U.S. Gross Domestic Product (GDP) growth was unrevised. Housing data showed disappointing results as new home sales fell sharply.

The 10-year Treasury yield popped 5 basis points on Friday to 4.73%. Oil prices were only slightly lower, with West Texas Intermediate futures slipping 0.2% Friday to $83.38 per barrel, down from over $94, its August high.

The coming week may be relatively quieter, as the calendar turns to September, but there is still some key economic data due. Labor is the key theme, with the latest Job Openings and Labor Turnover Survey due Tuesday and the ADP National Employment Report set for Wednesday. The all-important U.S. jobs report for August drops Friday. The latest Fed Beige Book also comes Wednesday.

Earnings season may be winding down, but several important earnings reports are due in the week ahead. These include artificial intelligence-related names such as Dell Technologies (DELL), Broadcom (AVGO), NetApp (NTAP) and Palo Alto Networks (PANW).

Please click here for the Looking Ahead report written by Wells Fargo. It contains interesting graphs, tables, and charts. Below are excerpts from that research.

Week in review: August 24-28

Economic news

• Inflation remained largely in line with expectations in July. The headline PCE inflation measure rose 0.2% from the prior month and 3.7% from a year ago, while core inflation, which excludes food and energy, increased 0.2% and 3.3%, respectively.
• • Higher portfolio management fees, and Healthcare costs rose modestly. Meanwhile, airfares were unchanged, and prices for hotels and rental vehicles declined.
• Personal spending and income both exceeded expectations in July, personal spending rose 0.2% month-over-month (M/M), above forecasts for a 0.1% M/M increase, while personal income climbed 0.4% M/M, topping expectations of 0.2% M/M.
  • Steady gains in wages, benefits, and dividend income helped drive a ninth consecutive monthly increase in personal income. As income exceeded spending, the savings rate also grew from 2.6% to 3.0%.
• U.S. Q2 GDP was unchanged at a 1.5% annualized growth rate. Consumer spending, which drives 2/3 of economic activity, was revised higher to an annualized 3.4% from an initially estimated 3.2%. Final sales were revised up to an annualized 4.2% from 3.9%, and government spending declined at an annualized rate of 1.0%.
• New home sales fell 10.5% M/M in July, which was far worse than market expectations for a 1.6% decline. The weakness was concentrated in the Midwest, where sales fell 43%, and the south, where sales declined 13%. Sales rose 30% in the northeast and 6.2% in the west, partially offset declines elsewhere.
• U.S. manufacturers received more orders in July than expected, suggesting demand remains healthy. Total durable goods orders rose 1.1% from the prior month, well above forecasts of 0.5%. However, excluding transportation, orders rose a more modest 0.4% M/M and came in slightly below expectations of 0.6% M/M.
• July wholesale inventory surprised to the upside, rising 1.3% M/M to $959.1 billion versus a much more modest expectation of a 0.2% M/M increase.

Looking ahead to this week: August 31 to September 4

U.S.

• The focus will be on the August ISM manufacturing and services PMIs on Tuesday and Thursday, respectively, before attention shifts to Friday’s August employment report.
• Labor market updates include the August ADP private employment report, Challenger job cuts report, and July Job Openings and Labor Turnover Survey, along with finalized Q2 non-farm productivity and unit labor costs.
• Additional releases include the Federal Reserve’s Beige Book survey of regional economic conditions, and July trade balance, factory orders, construction spending, and August vehicle sales.
• In Washington, the House of Representatives returns from its summer recess, with lawmakers widely expected to advance a stopgap funding measure ahead of the September 30 deadline to avoid a government shutdown.

Asia

• In China, the spotlight will be on August manufacturing and services PMIs, including both official government releases and private sector surveys from Ratingdog.
• Japan’s key releases include Q2 capital spending, July retail sales, household spending, housing starts, and preliminary industrial production, along with August, consumer confidence, monetary base, and finalized PMIs.
• South Korea will report July industrial production, August trade balance, and manufacturing PMI.
• Australia’s schedule includes Q2 GDP, July private sector credit, building approvals, and trade balance, along with August finalized PMIs and the Melbourne Institute Inflation Gauge.

Europe

• The highlight will be the finalized August PMI, together with the Euroszones, preliminary August, consumer price index, CPI and July unemployment rate, retail sales, and producer price index PPI.
• In the United Kingdom, investors will watch August house prices, and July consumer credit, mortgage approvals, reserve balances, and money supply.
• Elsewhere in the region, Germany will release preliminary August CPI data, July retail sales, and factory orders.