Market Summary
U.S. equities closed modestly lower on Friday, September 4, capping a volatile week as a much stronger-than-expected August Employment Report reignited expectations for a September Fed rate hike. The S&P 500 fell 29.11 points (-0.38%) to 7718.60, the Dow Jones Industrial Average dropped 271.86 points (-0.51%) to 53414.25, and the Nasdaq Composite slipped 77.07 points (-0.29%) to 26528.04. The report’s headline strength — nonfarm payrolls of 162,000 versus a consensus of just 45,000 — sent the 10-year Treasury yield briefly toward 4.80% and pushed the CME FedWatch implied probability of a September rate hike to roughly 60%, up from about 50% a day earlier.
Sector performance was sharply bifurcated. Information Technology and Industrials were the only sectors to finish in positive territory, aided by a 3.4% surge in the PHLX Semiconductor Index, while Consumer Discretionary, Energy, Materials, Health Care, Financials, Communication Services, Real Estate, and Consumer Staples all lagged. The divergence within tech was particularly notable: semiconductor strength offset a 2.2% decline in the iShares GS Software ETF, with Adobe (-6.73%) among the software laggards after naming a new CEO. Consumer Discretionary was pressured by a 5.92% drop in Tesla and a 17.38% plunge in lululemon following disappointing earnings and guidance.
This capped a choppy week in which the major averages finished little changed overall — the S&P 500 gained 0.1%, the Nasdaq rose 0.4%, and the Dow slipped 0.3% — as a roughly 10% surge in WTI crude tied to U.S.-Iran tensions and shifting Fed rate expectations drove intraday volatility. Attention now shifts to next week’s Producer Price Index and Consumer Price Index releases, which are expected to solidify — or reshape — market expectations ahead of the September 15-16 FOMC meeting.
Market Snapshot
| Index | Level | Change | % Change |
|—|—|—|—|
| Dow Jones | 53,414.25 | -271.86 | -0.51% |
| Nasdaq Composite | 26,528.04 | -77.07 | -0.29% |
| S&P 500 | 7,718.60 | -29.11 | -0.38% |
Breadth:
- NYSE: 1,321 advancers / 1,369 decliners; Volume 987.83 mln
- Nasdaq: 2,532 advancers / 2,338 decliners; Volume 6.54 bln
WaveFinder Breadth Metrics (as of 2026-09-04):
- Primary Sentiment: Bullish (Bulls 795 / Bears 535)
- 4% Sentiment: Bullish (Bulls 206 / Bears 104)
- 40 SMA Sentiment: Neutral
- Stocks Above 20-day SMA: 23%
- Stocks Above 40-day SMA: 49.91%
- 9-Month Bulls: 24 / Bears: 7 (30% Bull Follow-Through)
Sector Performance
Ranked from strongest to weakest (per Briefing.com Industry Watch and session commentary):
1. Industrials — +0.4% (Strong) — lifted by spillover strength from semiconductors
2. Information Technology — +0.2% (Strong) — sharp internal split; semis surged, software fell
3. Financials — -0.8% (Weak) — pressured by credit-bureau stock declines
4. Communication Services — -0.9% (Weak) — weakness in large-cap components
5. Consumer Discretionary — -1.3% (Weak) — Tesla and lululemon declines weighed heavily
6. Energy — Weak (no specific % provided)
7. Materials — Weak (no specific % provided)
8. Health Care — Weak (no specific % provided)
9. Real Estate — Weak (no specific % provided)
10. Consumer Staples — Weak (no specific % provided)
Note: GICS Utilities sector performance not specified in source data.
WaveFinder Sector Volatility (ATR): Energy showed the highest and rising volatility (+2.38%, P47), followed by Health Care (1.99%, falling, P0) and Communication Services (1.22%, falling, P16). Real Estate (-2.05%) and Utilities (-2.14%) registered the most negative ATR readings, both falling.
Key Earnings & Movers
- lululemon athletica (LULU): $100.61, -21.16 (-17.38%) — fell below $100 for the first time in years after Q2 revenue missed and management cut FY27 guidance for a second consecutive quarter.
- FICO: $932.26, -186.67 (-16.68%) — tumbled after FHFA Director Bill Pulte said Fannie Mae/Freddie Mac will allow lenders to use VantageScore, threatening FICO’s mortgage-scoring dominance.
- Sandisk (SNDK): $1,740.00, +185.01 (+11.90%) — surged on stronger DRAM/NAND pricing and robust server demand.
- Tesla (TSLA): $354.08, -22.28 (-5.92%) — gave back Thursday’s rally.
- Adobe (ADBE): $266.51, -19.24 (-6.73%) — declined after naming a new CEO.
- Equifax (EFX): $177.05, -12.04 (-6.37%) — fell alongside FICO on credit-scoring competition concerns.
- TransUnion (TRU): $79.88, -5.04 (-5.94%) — pressured by the same credit-bureau regulatory headlines.
- Oracle (ORCL): $158.83, +4.79 (+3.11%) — set to report earnings after Thursday’s close next week.
- DocuSign (DOCU): Trading higher after Q2 results beat expectations, with IAM platform adoption reaching 15.1% of ARR and FY27 ARR growth guidance raised to +8.5-9.0% from +8.25-8.75%.
Stock Spotlight
lululemon athletica (LULU) — the session’s most significant mover, down 17.38% to $100.61. The athletic apparel retailer’s Q2 results revealed deepening structural pressure: overall comparable sales declined 9% (10% in constant currency), driven primarily by traffic weakness rather than pricing. Americas comps fell 12% (versus a 5% decline in Q1), while China — previously a growth engine — saw comps drop 8% in constant currency after growing 13% in Q1. The company’s leggings category, a core product line, declined approximately 20% in the quarter.
Beyond the top-line miss, guidance proved the more significant catalyst for the selloff. LULU cut its FY27 outlook for the second consecutive quarter, with Q3 EPS and revenue guidance coming in well below expectations. Margin pressure compounded the issue: operating margin fell 190 basis points to 18.8% despite a substantial tariff-refund benefit, as fixed-cost deleverage (230 bps) and tariff/markdown pressure (160 bps combined) offset gains. Management is responding with increased second-half marketing investment and a more aggressive product “chase” strategy (~20% higher chase volume), but the guidance cut arrives amid an ongoing CEO transition, adding to investor uncertainty about the turnaround timeline.
Bond Market & Treasuries
Treasuries sold off Friday after opening with modest gains, reversing course immediately following the stronger-than-expected August jobs report.
Yield Changes (Daily / Weekly):
- 2-Year: 4.38% (+5 bps / +3 bps week)
- 3-Year: 4.45% (+4 bps / +5 bps week)
- 5-Year: 4.55% (+4 bps / +7 bps week)
- 10-Year: 4.78% (+2 bps / +6 bps week)
- 30-Year: 5.25% (unchanged / +4 bps week)
The 2s10s spread widened by 3 basis points this week to 40 bps, reflecting relative weakness in the belly of the curve. Key drivers included the stronger payrolls print, hawkish commentary from voting FOMC member and Cleveland Fed President Beth Hammack (“it’s time to act”), and a rise in the CME FedWatch-implied probability of a September rate hike to roughly 60%. The U.S. Dollar Index rose 0.3% to 99.16, trimming its weekly loss to 0.5%.
Commodities
- WTI Crude Oil: $91.50/bbl, +$0.15 (+0.2%) — gained roughly 10% for the week amid U.S.-Iran tensions
- Gold: $4,476.00/ozt, -1.4%
- Copper: $6.68/lb, +0.2%
- Silver data not available in source materials
Overseas Markets
Specific Asian and European index levels were not included in the source data; however, key overnight economic releases influenced sentiment:
- Japan: July Household Spending +0.5% m/m (expected +2.6%; prior -6.4%) but -3.6% yr/yr (expected -1.6%; prior -3.3%)
- South Korea: July Current Account surplus of $42.08 bln (down from $49.73 bln surplus)
- Eurozone: July Retail Sales -0.6% m/m (expected +0.3%; prior +0.2%) but +0.6% yr/yr
- Germany: July Factory Orders +2.5% m/m (expected +0.3%; prior +3.7%)
- Italy: July Retail Sales -0.4% m/m (expected +0.2%; prior -0.2%) but +0.8% yr/yr
Currencies: EUR/USD 1.1612 (-0.1%); GBP/USD 1.3515 (-0.1%); USD/JPY 156.22 (+0.3%); USD/CNH 6.7084 (-0.1%)
Economic Data
August Employment Situation Report (released 8:30 a.m. ET) was the dominant data catalyst:
- Nonfarm Payrolls: +162,000 (consensus +45,000); July revised up to +21,000 from -23,000; June revised to +31,000 from +20,000
- Private Sector Payrolls: +127,000 (consensus +45,000)
- 3-Month Average Payrolls: 71,000, up from 38,000
- Unemployment Rate: 4.1% (consensus 4.2%), unchanged from July
- Average Hourly Earnings: +0.3% m/m (consensus +0.2%); 12-month rate moderated to 3.1% from 3.2%
- Average Workweek: 34.4 hours (consensus 34.3)
- Labor Force Participation Rate: 61.6%, up from 61.4%
- U6 (underemployment) Rate: 7.7%, down from 7.9%
- Long-term unemployed (27+ weeks): rose to 27.0% of unemployed from 25.5%
Market Impact: The headline beat triggered an immediate hawkish repricing of Fed policy expectations, though underlying details (modest 3-month payroll average, moderating wage growth, rising long-term unemployment) tempered the case for an assured September hike.
Looking Ahead
- Monday, Sept 7: Bond and equity markets closed for Labor Day
- Tuesday, Sept 8: August NFIB Small Business Optimism Index (consensus 99.3; prior 99.8) at 6:00 ET; $58 billion 3-year Treasury note auction
- Week ahead: August Producer Price Index (consensus +0.4%; prior 0.0%) and August Consumer Price Index (consensus +0.4%; prior +0.1%) — critical inputs for September FOMC rate-hike probability, with CPI specifically flagged as a key catalyst for solidifying market expectations
- Thursday: Oracle (ORCL) reports earnings after the close
- September 15-16: FOMC meeting — current CME FedWatch probability of a 25-bp hike stands at approximately 58-60%