WEEKLY MARKET RECAP – SEPTEMBER 26, 2025

All three major U.S. stock indexes opened the week at record highs on Monday but slipped modestly over the following days. The S&P 500, NASDAQ, and Dow each posted three straight daily declines starting Tuesday and ended the week slightly lower. For the S&P 500, it was only the second negative week in the past eight.

The Federal Reserve’s preferred inflation gauge showed a continued, gradual rise. The Personal Consumption Expenditures (PCE) Index increased at a 2.7% annual rate in August, up from 2.6% in July and marking a six-month high. Core PCE, which excludes food and energy, climbed 2.9%, in line with economists’ expectations.

In Washington, budget negotiations remained tense as the new fiscal year begins on October 1. As of Friday, Democratic congressional leaders, Republicans, and the White House had yet to agree on a plan to fund government operations and avoid a partial shutdown. Although Republicans control both chambers of Congress, they will need Democratic support in the Senate to pass a funding extension.

Economic growth proved stronger than earlier thought. A government revision on Thursday showed that U.S. GDP expanded at a 3.8% annual rate in the second quarter, topping previous estimates of 3.3% and 3.0%, and sharply reversing the slight contraction recorded in the first quarter.

Gold continued its rally. Futures prices rose for a sixth straight week to reach a fresh record above $3,800 per ounce on Friday, bringing total gains over that period to about 14%.

Consumer sentiment weakened further. The University of Michigan’s index fell to 55.1 in September from 58.2 in August, its third consecutive monthly decline, as survey respondents cited concerns about inflation and a softer labor market.

Oil prices also surged. U.S. crude futures jumped more than 5% for the week, their biggest weekly increase in over three months, and traded near $66 per barrel on Friday. The commodity had been moving in a narrow $62–$65 range since early August.

Looking ahead, investors await Friday’s monthly employment report for clues on labor-market health. August data showed just 22,000 new jobs—well below forecasts—and an unemployment rate of 4.3%, the highest since 2021.