People shop for food at a supermarket in Monterey Park, California on September 9, 2025. <\/p>\n
Frederic J. Brown | Afp | Getty Images<\/p>\n
A tamer-than-expected U.S. inflation report for September injected optimism into markets. Traders are now betting<\/a> that the Federal Reserve will almost certainly cut rates at its October meeting \u2014 scheduled for later this week \u2014 as well as at its December gathering.<\/p>\n Major U.S. indexes climbed Friday and had their second consecutive week in the green, with the S&P 500<\/a>, Nasdaq Composite<\/a> and the Dow Jones Industrial Average<\/a> all up about 2% for the week.<\/p>\n The inflation report offers additional support to markets already buoyed by a strong earnings season. Of the companies that have reported so far, 87% managed to exceed Wall Street’s expectations<\/a>, much higher than the typical 67% beat rate, according to LSEG. If Big Tech earnings this week top estimates \u2014 and provide upbeat guidance \u2014 markets could see fresh highs.<\/p>\n U.S. President Donald Trump’s tariffs, however, are still a chilly overhang amid the warm sentiment. Trump on Saturday hit Canada with an additional 10% tariff, as punishment over an ad.<\/p>\n Economists have been warning that tariffs will lead to higher prices. Indeed, while the consumer price index report came in below estimates, September’s headline annual rate rose to 3% from the previous month’s 2.9%<\/a>.<\/p>\n “Inflation might not be slowing but it’s not surprising to the upside anymore,” said <\/strong>David Russell, global head of market strategy at TradeStation.<\/p>\n With the lack of other data, such as the jobs report, because of the U.S. government shutdown, we don’t have the full picture of how the economy is performing \u2014 so the rise in markets could be balanced on a precarious ledge.<\/p>\n What you need to know today<\/p>\n Trump hits Canada with an extra 10% tariff. <\/strong>This brings general duties on Canada to 45%<\/a>. Ontario said it would stop its ad featuring Ronald Regan criticizing tariffs \u2014 which incensed Trump \u2014 after the first two games of the World Series.<\/p>\n Trade developments at the ASEAN Summit. <\/strong>Top U.S. and China officials met Sunday, resulting in “a very successful framework” <\/a>for talks between Trump and Xi, according to U.S. Treasury Scott Bessent. Trump announced agreements with four Southeast Asian countries<\/a>.<\/p>\n U.S. inflation rose less than expected. <\/strong>The consumer price index for September<\/a> came in at 0.3% for the month, putting the annual rate at 3%. Both figures were 0.1 percentage points lower than the 0.4% and 3.1%, respectively, expected by a Dow Jones survey of economists.<\/p>\n Stocks rise on CPI report. <\/strong>Major indexes climbed Friday<\/a>, with the Dow Jones Industrial Average closing above 47,000 for the first time. The pan-European Stoxx 600<\/a> added 0.23%, reversing earlier losses<\/a>. U.S. stock futures rose Sunday<\/a> evening stateside.<\/p>\n [PRO] Packed week of earnings and meetings ahead. <\/strong>This week, five of the Magnificent Seven group of stocks \u2014 all but Tesla<\/a> and Nvidia<\/a> \u2014 will be reporting their financial results, the U.S. Federal Reserve will convene and the Trump-Xi meeting could finally happen<\/a>.<\/p>\n And finally…<\/p>\n U.S. President Donald Trump (left) and Chinese President Xi Jinping.<\/p>\n Jim Watson and Peter Klaunzer | Pool, AFP | Getty Images<\/p>\n