Evidence of the slowing momentum of China's domestic economy since December 2024 continued mounting in September 2026. It did so in the form of the continuing decline in the pace of carbon dioxide accumulation in the Earth's atmosphere. That pace has dropped to levels consistent with where large recessions have bottomed during the 21st century.

Much of that decline is an outgrowth of a debt crisis, in which the Chinese government's previous efforts to stimulate the nation's economy to stave off recessions with its debt-fueled investments has left its domestic economy with the overhang of overproduction. China's internal property market directly reflects that outcome, which has become a deflationary drag on both the housing and banking sectors of its economy as production has stalled. That decline has shown up in the atmosphere in the form of reduced carbon dioxide emissions from the nation's cement production and also its production of steel.

Meanwhile, China's export-oriented industries have also taken a major hit from the global tariff war between the U.S. and China. Chinese exporters have sought to get around the loss of U.S. business by cranking up their exports to other regions like the European Union, but that effort has created an economic backlash which is leading to new curbs on its automotive exports. Falling industrial production to support its export economy from tariffs and other trade restrictions is also contributing to falling CO₂ emissions.

The following chart shows the still continuing downward trend in the rate at which carbon dioxide accumulates in the Earth's air:

The decline in the pace of carbon dioxide accumulation in the atmosphere has slowed in recent months, which might be attributed to increasing emissions from other parts of the global economy that are growing. Even so, China remains the world's largest producer of carbon dioxide emissions by a very wide margin. Because of that fact, changes in atmospheric CO₂ concentration tells us much more about the relative health of China's economy than that of any other nation.

References

National Oceanographic and Atmospheric Administration. Earth System Research Laboratory. Mauna Loa Observatory CO2 Data. [Online Data]. Updated 5 September 2026.

Image Credit: OCO-3 Carbon Source-Sink Infographic by NASA. U.S. Government work public domain image.

Trade between the U.S. and China continued showing signs of overall improvement. Trade data reported by the U.S. Census Bureau for August 2026 indicates a small month-over-month decline, but significant year-over-year gains.

The combined value of all goods exchanged between the U.S. and China declined $0.9 billion (or 2.4%) from $36.8 billion in July to $35.9 billion in August 2026. However, that figure was up $2.5 billion (or 7.3%) from August 2025's $33.4 billion.

Meanwhile, the trailing twelve month average of the trade between the U.S. and China rose to $31.6 billion in August 2026, up $1.3 billion (or 4.2%) over its April 2026 low. Trade between the two nations has been slowly increasing in the period since the one-year anniversary of President Trump's 2 April 2025 "Liberation Day" global tariff announcement.

The following chart presents the monthly data for the combined value of goods exchanged between the U.S. and China and its trailing twelve month average for the period from January 2017 through August 2026.

The trailing twelve month average of the combined value of goods exchanged between the U.S. and China is about $19.3 billion below our counterfactual projection of what the level of trade between the two nations would have likely been in the absence of the global tariff war. Over the last three months, it has roughly paralleled it, indicating trade between the U.S. and China is stabilizing at a much reduced level.

Looking forward to September 2026, the Port of Los Angeles reported it processed a record high number of containers, indicating U.S. imports of Chinese-produced goods increased from August's level. This outcome was expected as importers of goods from China were seeking to accelerate the delivery of many products ahead of the U.S. Christmas shopping season to avoid tariff increases.

References

U.S. Census Bureau. U.S. International Trade in Goods and Services (FT900). U.S. Trade in Goods with China, Not Seasonally Adjusted, Nominal Figures, Total Census Basis. [Online database]. Accessed 6 October 2026.

Image Credit: Port of Los Angeles photo by Linnaea Mallette on PublicDomainPictures.ent. Creative Commons CC0 1.0 Universal Deed.

The S&P 500 (Index: SPX) hit a new record high of 7,818.54 on Tuesday, 6 October 2026. The index then proceeded to bounce around a little below that level before wrapping up the trading week at 7,811.54, less than 0.1% below its new record high close.

Overall, it was a good week for the handful of big cap AI tech stocks that account for a disproportionately large portion of the total value of the S&P 500 index. It was a particularly good week for Nvidia (NASDAQ: NVDA), the single stock whose shares account for eight percent of the entire market capitalization of the S&P 500 index, which not uncoincidentally, also hit its own all time record high on Tuesday, 6 October 2026 as spending on Artificial Intelligence (AI)-related infrastructure and development continues to power the earnings of these megacap stocks.

How long that state of affairs might continue is perhaps the biggest question investors face as the fourth quarter's earnings season gets underway, which is dueling with the other big question of how much more might the Federal Reserve hike short-term interest rates in the U.S.?

On that count, the CME Group's FedWatch Tool outlook was effectively unchanged from the previous week. It continues to project the Fed will act to hike the Federal Funds Rate by a quarter point on 9 December (2026-Q4), followed by more quarter point rate hikes that will be announced when the Fed's rate-setting Open Market Committee meets on 17 March (2027-Q1) and 9 June (2027-Q2). What did change is that the FedWatch tool now sees the June 2027 hike as the last in 2027.

The latest update of the dividend futures-based model's alternative futures chart indicates investors shifted their forward-looking attention from the current quarter of 2026-Q4 to the slightly more distant future quarter of 2027-Q1 on Friday, 9 October 2026. With the Fed expected to leave interest rates alone until December, the shift in focus signals investors will be paying close attention to how the outlooks of publicly-traded businesses going into 2027 might change as they report their earnings.

Here are the market moving headlines of the trading week ending on Friday, 9 October 2026:

Monday, 5 October 2026

• Signs and portents for the U.S. economy:
• US services sector cools in September, price pressures building
• Oil slips on rising Mideast crude exports, G7 stocks release
• OPEC+ agrees to keep November oil output targets steady
• Trump to issue order expanding access to tax-exempt diesel fuel, sources say
• Fed minions say they won't hike rates in October, but might in December 2026:
• Fed may skip October but pull rate hike trigger in December
• Fed's Hammack tells PBS there's still time to weigh next monetary policy move
• Bigger trouble developing in China:
• China shuts hundreds of banks as Beijing moves to shore up its financial system
• Former BOJ minion says it's time BOJ and JapanGov minions changed their gamebook:
• Reflationist ex-BOJ policymaker calls end to low rates, big spending
• Bigger trouble developing in the Eurozone:
• French bond contagion fears are rattling the euro
• Euro drops to 17-month low on France debt concerns
• France, Germany push for EU rapid-response trade tool with likely focus on China
• Wall Street finished on top as the Nasdaq tagged a record high
• Nasdaq notches record high close as investors focus on earnings
• S&P 500 nears record high despite the struggling underlining breadth

Tuesday, 6 October 2026

• Signs and portents for the U.S. economy:
• US trade deficit widens in August amid strong imports
• Oil rises as concerns over Houthi attacks on Saudi Arabia eclipse supply recovery
• Trump expands access to tax-exempt diesel fuel
• US EIA hikes oil price forecasts again as Iran war drains global stockpile
• Fed minions say they're waiting to see what happens with oil and global bond crisis shocks before changing U.S. short term interest rates, want to change how they "supervise" U.S. banks:
• Fed's Daly: need for more hikes hinges on what happens with shocks
• Fed plans to overhaul bank supervision responsibilities, Bowman says
• Lesser stimulus for exports developing in China:
• China polishes a potent weapon for EU car wars
• BOJ minions thinking about changing up their monetary policy strategies as they realize they're getting the inflation they wanted:
• BOJ chief calls for more focus on anchoring inflation around target
• BOJ may signal underlying inflation has hit 2% goal, sources say
• BOJ says AI boom may have eased financial conditions, warns of market risks
• BOJ's dovish dissenter signals support for future rate hikes
• Lesser trouble developing in Eurozone:
• Le Pen vows drastic budget cuts to prevent French 'default' on debt
• French Bonds Rally As Le Pen Unveils Shadow Budget To Pull France Back From Fiscal Brink
• Sayonara, OATs: After Treasuries, Japan Now Looms Over France's Bond Rout
• ECB minions see higher rates crushing Eurozone economy enough to lower energy prices, warned that chief minions plans to leave early for next job not a good idea:
• ECB's Rehn: High yields to dampen energy price pass-through
• Early ECB leadership change could worsen Paris bond jolt
• Wall Street ended higher as S&P 500 and Nasdaq tag new highs
• S&P 500, Nasdaq reach record closing highs as focus pivots to earnings
• Wall Street profits soar to $45.9 billion in first half of 2026, report shows

Wednesday, 7 October 2026

• Signs and portents for the U.S. economy:
• US 30-year mortgage rate hits highest in nearly three years
• Mortgage rates sit at nearly 3-year high, and demand continues to shrink
• Oil prices settle down as IEA agrees to accelerate oil stock release
• US bonds selloff eases, yields off highs, after strong 10-year note auction
• Fed minions thinking hard about hiking U.S. interest rates again:
• Hawkish FOMC Minutes Show All 19 Fed Officials Supported Rate Hike, "Most" Assess Another Hike "By Year End Is Appropriate"
• Fed policymakers divided over rate-hike logic in September, minutes show
• Fed minutes show some officials want to prepare for market stress
• Bigger trouble developing in Eurozone:
• Europe stocks retreat after three-day rise as rising yields, oil dent sentiment
• European bank shares fall as bond yields surge, spreads widen
• France does not need ECB's help at present, says Bank of France head
• EU seeks to cut trade deficit with China in talks with Beijing
• Wall Street closed in the red as investors focused on yields and the Fed minutes
• Wall Street ends lower, off record highs, as Treasury yields climb
• S&P 500 stocks with negative beta hit record 130

Thursday, 8 October 2026

• Signs and portents for the U.S. economy:
• US 30-year fixed-rate mortgage rate hits 7.40%, likely to further erode housing demand
• Oil jumps as Middle East supply concerns persist amid shipping attacks
• Crude oil turns lower as IEA agrees to accelerate oil stock release, prioritize diesel
• US weekly jobless claims fall as layoffs remain low
• Fed minions say they want to hike U.S. interest rates more, but willing to spread the hikes out:
• Fed's Waller: More hikes needed, but there is 'flexibility' about the pace
• Fed's Musalem says tighter monetary policy needed to lower inflation
• BOJ minions worry about inflation getting bigger than they wanted:
• Bank of Japan sees broadening inflationary pressure
• ECB minions put up 'Help Wanted' sign in window:
• Euro zone finance ministers start steps to replace ECB's Schnabel
• S&P 500, Nasdaq end lower as crude prices jump, chip stocks weigh
• Wall Street ends mostly lower on oil pop, AI stock retreat

Friday, 9 October 2026

• Signs and portents for the U.S. economy:
• US freezes green cards for Microsoft and other IT firms
• Oil falls as Trump comments on Iran talks ease supply fears
• Trump says Russia to immediately supply 300,000 tons of diesel fuel
• US diesel prices remain high despite Trump's moves to boost supplies
• Port of Los Angeles sets September volume record, executive director says
• Fed minion still not cleared in ethics probe:
• Trump renews bid to fire Fed's Cook with fresh White House inquiry
• Fed's Cook lawyers say hearing will show no mortgage fraud case
• Bigger stimulus, more control over regional economies and AI developing in China:
• China ramps up fiscal push to meet growth target
• China's tax crackdown piles pressure on luxury brands as US spending falters
• China to resume October fuel exports after holiday pause, sources say
• China vows to curb tech bubbles, keep AI risks in check
• ECB minions learn German politicians want more control over what they do, Eurozone minions tell French politicians to get their act together:
• Germany wants seat on ECB's executive board, finance minister says
• Euro zone ministers tell France to pass 2027 budget to calm markets
• Eurozone minions looking to cut China's exports of hybrid autos after blocking EVs:
• EU says it agrees with China to halve hybrid vehicle exports to EU
• Alarm bells sound in Brussels as EU sales of Chinese hybrid cars rocket
• S&P 500 advances for week amid AI jitters and sector rotation
• Wall Street posts weekly gains with earnings, inflation data on tap
• Dow rises 400 points on Friday as Wall Street scores winning week
• S&P 500’s top five stocks match market cap of bottom 434, Batnick says
• From railroads to AI, the new Gilded Age of concentration
• AI-centered US stock bull market nears four-year anniversary

The Atlanta Fed's GDPNow tool's projection of real GDP growth for the U.S. economy in 2026-Q3 dipped to 3.6% from the +3.7% annualized growth it projected a week earlier.

Image credit: Microsoft Copilot Designer. Prompt: "An editorial cartoon of a young bull and bear who are out trick-or-treating on Wall Street with the bull filling their bag with candy labeled 'AI' while the bear says 'YOU ARE GOING TO GET SICK EATING ALL THAT!'".

What happens when you apply outside-the-box thinking to an inside-the-box challenge?

The inside-the-box challenge, in this case, is the magnetic compass. Once a vital tool for navigation in the days before satellites and the Global Positioning System, the magnetic compass of our modern era is something that hikers will carry as a backup. That backup status is conveyed in their modern design, which more often than not, means something that has been assembled from inexpensive plastic components. If they look cheap, it's because they are cheap. What was an indispensable tool has become disposable.

But what if it wasn't a throwaway item? Oceanus Brass' Victoria Warren systematically thought through every element of the magnetic compass and came up with the Lodestar Compass, elevates almost every one of the aspects of a magnetic compass into something that's anything but disposable. The following video, created for its Kickstarter campaign, showcases the Lodestar Compass as a high quality, functional device.

Some might call it overengineered, but it cannot be denied that every aspect of its design has been thought through and the result is something that will have and keep real value.

Warren's Kickstarter campaign has several days left to go at this writing, but the project has been successfully funded and Oceanus Brass' Lodestar Compass will be produced. The campaign will run through 15 October 2026.

The market capitalization of the S&P 500 (Index: SPX) increased during the third quarter of 2026, rising 1.9% above where it finished in the second quarter.

The S&P 500's 503 stocks, covering all 500 firms that compose the index, collectively grew by a little over $1.26 trillion to reach a total valuation of a little shy of $68.45 trillion.

That topline number however conceals a major split within the index. Most of the index' gain in valuation was concentrated within the top ten stocks, which increased from $24.50 trillion to $26.80 trillion as their share of the index' value rose from 36.5% to 39.2% of its total value.

That increase offset a decline in the combined market capitalization of the remaining 493 stocks of the S&P 500, which fell 2.4% from $42.69 trillion to $41.64 trillion.

The following chart shows the relative shares of the top 10 stocks in the S&P 500 at the close of trading on 30 September 2026, the end of the third quarter of 2026.

The membership of the S&P 500's Top 10 stocks remained the same as at the end of 2026-Q2, but several changed their rank within the elite group. Meta Platforms (A) (NASDAQ: META) surged from ninth place to seventh as the company released its Muse agentic AI tool, knocking both Broadcom (NASDAQ: AVGO) and Tesla (NASDAQ: TSLA) down one place each to eighth and ninth place within the index. Here are the ranked Top 10 stocks of the S&P 500 as of 30 September 2026.

• Nvidia (NASDAQ: NVDA) $5,441,663,080,695 (7.95%)
• Apple (NASDAQ: AAPL) $4,750,332,299,374 (6.94%)
• Microsoft (NASDAQ: MSFT) $3,778,362,289,992 (5.52%)
• Amazon (NASDAQ: AMZN) $2,662,650,236,969 (3.89%)
• Alphabet (A) (NASDAQ: GOOGL) $2,156,130,654,615 (3.15%)
• Alphabet (C) (NASDAQ: GOOG) $2,012,388,610,974 (2.94%)
• Meta Platforms (A) (NASDAQ: META) $1,813,887,693,565 (2.65%)
• Broadcom (NASDAQ: AVGO) $1,642,766,213,040 (2.40%)
• Tesla (NASDAQ: TSLA) $1,375,816,703,421 (2.01%)
• Micron Technology (NASDAQ: MU) $1,170,470,926,791 (1.71%)

The S&P 500 index has twelve stocks whose market caps exceed $1 trillion. Berkshire Hathaway (NYSE: BRK.B) and Eli Lilly & Company (NYSE: LLY) round out the membership of the index' trillion-dollar club.

Top ranked Nvidia's market cap increased to $5.44 trillion, accounting for almost 8% of the entire value of the S&P 500 by itself.

References

Standard and Poor. S&P 500 Factsheet. [PDF Document]. 30 September 2026. Accessed 1 October 2026.

SlickCharts. S&P 500 Component Weights. 30 September 2026. Accessed 1 October 2026.