Latest / Arctos x Teddy Sin - Coffee Break, Market Take / 26/10/2026 Mon - Oil grabs headlines. The 5% yield matters more.
Transcript
- This is my AI voice. The script comes from my market research system, and a person checks it before it goes out. It's education, not personal investment advice. Good morning. Teddy here. It's Monday, the twenty-sixth of October. Most people will wake up today thinking oil is the big story. And it is loud. But I want to talk about a quieter number first. Because that's the one doing the squeezing. On Friday, the US ten-year Treasury yield closed at 4.999 percent. One basis point away from five percent. Hold that number in your head for a moment. We'll come back to it. Now, the loud story. Brent crude settled on Friday at 116 dollars and 72 cents a barrel. Up 3.1 percent in a single day. That's its highest close since the twenty-ninth of April. WTI, the American benchmark, rose 3.8 percent to 103 dollars and 27 cents. The trigger was Houthi attacks on Saudi energy sites. The market is worried about more supply disruption from the Middle East. The US energy sector jumped 2.4 percent to a record high. Early Sunday trade showed crude dipping a little, and US futures edging up. So Monday opens with that heat already being tested. Headlines like this can reverse over one weekend. Remember that. Here's why the two numbers belong together. Expensive energy keeps inflation sticky. Sticky inflation keeps interest rates high. And high rates squeeze the stocks everyone loves most. That's the chain. Oil, inflation, yields. Three links. You could see it in last week's scoreboard. The Nasdaq fell 0.7 percent for the week. The S&P 500 fell half a percent. But the Russell 2000, the small companies, rose 2 percent. And the Dow, even after dropping 1.2 percent on Friday, still finished the week higher. Money didn't leave the market. It moved. Part of that move is about artificial intelligence. On Thursday the Nasdaq had its biggest one-day drop since June. Meta kept its spending plans unchanged, with little detail. Tesla cut its full-year capital spending guidance by 20 percent. And the worry flipped. For months, people feared AI companies were spending too much. Now some fear they're spending too little. That the boom may have peaked. Chip stocks steadied on Friday, but the doubt is still there. So this week has three tests. Let me walk you through them in Malaysia time. Test one. The Federal Reserve. The decision lands at two in the morning on Thursday. Almost nobody expects a change. Rates should stay at 3.75 to 4 percent, with about 90 percent odds of no move. But here's the catch. Futures markets put the odds of a December hike at about 71 percent. So the words matter more than the decision. If Jerome Powell leans toward a hike, that ten-year yield can push through five percent. That's downward pressure on the Nasdaq and on small caps. If he sounds patient, the pressure eases. Test two. Big Tech earnings. Alphabet and Microsoft report after the US close on Wednesday. That's early Thursday morning for us. Amazon follows on Thursday. About a third of the S&P 500 reports this week. The question for all of them is simple. Are you still spending on AI, or not? Then on Thursday night at eight thirty, US third-quarter growth and the September PCE inflation number land together. Consensus for headline PCE is 3.6 percent year on year. Test three. Central banks outside America. The European Central Bank decides on Thursday night, with French bond stress in the background. The French spread is at its widest since 2011. The Bank of Japan decides on Friday, around midday. A hold at 1.25 percent is expected. A December hike is priced at about 80 percent. Closer to home. The FBM KLCI closed Friday at 1,611.56, up 0.21 percent, holding above 1,600. Palm oil futures rose 36 ringgit to 4,587 ringgit a tonne on export demand. The Nikkei closed Friday at 62,693, down 0.34 percent. Gold fell about 1.3 percent to around 4,008 dollars. And Bitcoin sat near 80,477 dollars on Sunday morning, right around the level where the average ETF buyer is in profit or loss. Now, the part I care about most. I learned this the expensive way. Big-event weeks don't usually hurt you because your read is wrong. They hurt you because your size is wrong. The candles get long enough to hit a stop that looked safe on Monday. So this week, before you act, check three things on your own chart. Candles. Direction. Momentum. If they line up, fine. If they don't, sitting out is also a decision. And the loss you avoid can become a good family dinner on Saturday. This is educational market commentary, not personal financial advice. No outcome is guaranteed. Markets carry risk of loss. Size your risk before any trade. Survive first. See you tomorrow.