Note: There is a lot of ground to cover in this weekly update, so I used more bullet points to shorten the information overload!
Interest Rates and the Fed: The Federal Reserve held interest rates steady this week, as expected, and Chairman Kevin Warsh made it clear that fighting inflation is still job number one. Here are the highlights from the meeting and his follow-up press conference:
• Rates held at 3.75% to 4%, as expected.
• Two officials, Lisa Cook and Beth Hammack, voted to raise rates instead.
• Rate decisions will drop to seven in 2027 and six in 2028, down from eight.
• Warsh called the job market “quite positive” but said inflation is still too high.
• Warsh said politics played no role, with the midterms just six days away.
Weekly Economic Data: The first estimate of third-quarter GDP showed the economy grew at a 3.4% annual pace, beating the 3.2% forecast and picking up from 2.2% in the spring. Consumers led the way, with spending growing at a solid 3.8% pace for the second straight quarter. The PCE price index, the Fed’s preferred inflation gauge, rose 3.6% from a year ago in September, up from 3.4%, as higher oil and gas prices fed through. Core PCE, which leaves out food and energy, rose 3.1%. Both matched expectations, but they support the Fed’s cautious stance. Housing, on the other hand, is cooling. The Case-Shiller index showed home prices were up 2.1% from a year ago in August, slower than inflation. New home sales held near a 676,000 annual pace in September, and Redfin reported that the median home-sale price slipped 0.1% from a year ago, the first decline in more than three years. With mortgage rates above 7%, many buyers remain on the sidelines and cautiously watching.
Earnings season: Weakness in tech, but bright spots in other places.
• Alphabet (Google): Sales grew 25% and cloud more than doubled, but it missed estimates and the stock fell nearly 13%, its worst day on record.
• Microsoft: Beat expectations, with its Azure cloud business up 48%.
• Amazon: Sales grew 12% and AWS grew 39%, but profits missed and heavy AI spending pushed cash flow negative.
• Intel: Beat on earnings, but a weak outlook tied to slower PC sales sent the stock down significantly.
• The takeaway: Investors reward AI spending when it shows up in sales and punishes it when it doesn’t. This story will continue to unfold.
On the freight side, UPS and FedEx both raised their outlooks, with UPS expecting daily shipping volume to jump about 25% into the holidays, a good sign that supply chains are healthy. Meanwhile, the mixed tech earnings weighed on the Nasdaq, which fell 1.4% on Thursday and was down again today. After a strong run, pullbacks like this are normal and healthy for sustained longer-term growth.
Interesting to Note
Daylight Saving Time ends on Sunday, November 1, so don’t forget to set your clocks back one hour before bed on Saturday night. With Halloween on Saturday, about three out of four Americans plan to celebrate this year, spending an estimated $13.5 billion. Spider-Man is again the top costume for kids, and the pumpkin is the most popular costume for pets, followed by the hot dog!
Looking Ahead
• Midterm elections (Tues., Nov. 3): All 435 House seats and 35 Senate seats are on the ballot. Close races may take days to call, which could add short-term volatility, but historically the market has posted gains in the year following each of the last six midterm elections.
• More earnings (Nov. 2–6): Apple and Palantir report Monday, and AMD reports Tuesday, with more than 100 S&P 500 companies on deck for the week.
• New I Bond rates (Nov. 1): The Treasury announced Friday that Series I Savings Bonds bought through April 2027 will earn 5.51%, up from 4.26%.
• October jobs report (Fri., Nov. 6): A key read on the job market ahead of the next inflation report on November 10.
• Next Fed meeting (Dec. 8–9): The final meeting of the year will include updated economic projections.
Happy Halloween and have a nice weekend!
Written by: Chris Wasson, CFP®
Sources:
Federal Reserve: Chairman Warsh’s Press Conference Transcript, Oct. 28, 2026
CNBC: Fed meeting recap: Warsh says central bank will host fewer rate-setting meetings
CNBC: Five key takeaways from the Fed rate decision and Warsh news conference
CNN: Fed keeps interest rates unchanged, but two officials dissented in favor of a rate hike
Fox Business: Federal Reserve holds rates steady ahead of election
HousingWire: Case-Shiller home prices continue to lag inflation in August
HousingWire: Why home prices and new home sales aren’t as hot as today’s reports show
Redfin: U.S. Home-Sale Prices Just Fell for the First Time in 3 Years
Alphabet: Alphabet Announces Third Quarter 2026 Results
CNBC: Alphabet sinks 10% as it holds 2026 capex unchanged
SiliconANGLE: Microsoft’s stock rises on solid earnings and revenue beat, with Azure growing 48%
The Motley Fool: AWS Jumps 39% as Amazon’s Cash Flow Sinks: Rapid Earnings Reaction
Shacknews: Intel Q3 2026 earnings results beat EPS and revenue expectations, Q4 guidance disappoints
Stock Titan: Stock Market Today October 29, 2026: Nasdaq Falls as Alphabet Drops
Money: New I Bonds Rate Boasts Guaranteed Returns Over 5%
UPS: UPS Releases 3Q 2026 Earnings
Investing.com: Earnings call transcript: UPS beats Q3 2026 estimates and lifts outlook
FedEx: FedEx Reports Strong Third Quarter Results
Benzinga: FedEx Q3 2026 Earnings Call Transcript
Fidelity: How might midterm elections impact the stock market?
Morgan Stanley: Midterm Elections: More Noise Than Change?Dallas Express: Americans Set To Spend $13.5 Billion On Halloween
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