Three Straight Losses. The Bond Market Is Running This Week.

The S&P fell 0.5%. The Dow dropped 400 points. The Nasdaq shed 0.64%.

Treasury announced its first expanded buyback. The 10-year yield hit 4.857%, its highest since November 2023. A solid 10-year note auction at 1pm gave modest afternoon relief. WTI climbed to $96 as the US destroyed multiple Iranian oil tankers.

CPI lands Friday. The Fed starts on Tuesday and announces Wednesday.

TQ Trade Implication

PPI Thursday. 30-year auction Thursday. CPI Friday. Three prints in 48 hours. The last data before the Fed stops talking. Own short duration through all three.

Bessent Said He's the House. Yields Went Higher Anyway.

Tuesday at Southern Methodist University, Bessent said: "I am the house now. You can bet against me if you want." He was talking about the yen. Treasury has been buying Japanese currency so the Bank of Japan does not have to sell its $1.1 trillion of Treasuries.

Wednesday it sized the other half. The buyback came in at $6 billion, above the $4 billion floor set August 19. Wrightson ICAP had called $6 billion fairly aggressive. Treasury delivered at the top of the range.

The 10-year hit 4.857% anyway, its highest since November 2023. It is up about 10 basis points since the buyback was first announced. Treasury is doing what it said, at the size the market wanted, and yields are higher than when it started.

TQ Edge Setup

Thursday runs the 30-year auction and the first buyback at new size in the same session. BMO's Ian Lyngen calls 5.3% on the long bond the line in the sand Bessent effectively drew. Watch the auction's bid to cover and how much paper holders actually offer into the operation.

The US Destroyed Five Iranian Tankers. Month Seven Looks Nothing Like Week One.

In March, analysts expected this to end in weeks.

Goldman Sachs now warns Brent could reach $120 if Hormuz stays shut. Tuesday the US military destroyed five Iranian crude tankers after Iran fired ballistic missiles at an American warship. WTI climbed toward $96. Brent closed over $101 for the first time since July.

Europe heads into winter with the lowest natural gas inventories in 15 years. Only five LNG cargoes transited Hormuz in August versus 97 crude tankers. LNG ships require specialized crews and are expensive to insure. Multiple fuel shortages are compounding simultaneously.

TQ Execution Bias

Diesel hit a record $5.85 per gallon last Friday. WTI above $90 heading into a Fed decision with inflation above 3% is the most uncomfortable single input. Own integrated energy and domestic refiners. The Goldman $120 scenario keeps hike odds elevated regardless of CPI.

Apple Launched Its First Foldable Phone. The Stock Fell Again.

John Ternus unveiled the iPhone Duo at his first CEO keynote. Starting price estimated at $2,200. iPhone Pro prices are expected to rise $150-200 because memory and storage chip costs have quintupled since last fall. The stock fell about 1.75%. Apple (AAPL) has trailed the S&P 500 on five consecutive launch days. Bank of America says launches typically produce positive returns over the following 60 days.

The memory cost story is the bigger one. If Apple must raise prices because chips quintupled, every hardware maker faces the same input. This is the same memory cycle that compressed Broadcom's (AVGO) gross margin last week.

TQ Execution Bias

The foldable opens a new price tier. The 60-day launch pattern argues for holding through the noise. Watch memory cost trends in next quarter's guidance as the primary risk.

• Signet Jewelers (SIG) surged 24% on a Q2 earnings beat. Adjusted EPS of $2.19 versus a $1.74 estimate. Full-year guidance raised. Consumer jewelry spending holds where apparel and sporting goods are cracking.
• Casey's General Stores (CASY) fell over 10% despite beating on earnings. Same-store sales slowed. Prepared food and fuel gallons missed. The stock was up 30%+ heading in. At high valuations, beats are not enough if momentum softens.
• Jersey Mike's (JMKE) rose on its first public earnings report. Strong order growth while most chain restaurants are discounting to stay relevant.

Bessent called himself the house.

The buyback fell short. Yields hit cycle highs. Apple's foldable launched and the stock fell anyway. WTI near $96. Three straight down sessions.

Three prints land in the next 48 hours. PPI Thursday. 30-year auction Thursday. CPI Friday. After Friday, the Fed goes silent until the decision. Those three inputs are the entire hand the market plays before September 16. Warsh gets no more data. The market gets no more guidance. Everything settles by Friday morning.