The Fed left rates unchanged and reiterated its commitment to containing inflation, without a clear signal it might raise rates at its December meeting. NewEdge Wealth CIO Cameron Dawson argues the Fed is contradicting itself by aiming to tighten financial conditions to bring inflation back to 2% without causing market pain, since tightening typically brings higher volatility in stocks and credit. Core PCE was cited at around 3.1% annualized, and nominal GDP at about 6.4% (3.2% growth plus a 3.2% price index), with resilient growth and elevated nominal GDP keeping pressure on yields. Dawson also linked slowing Google cloud or ad revenue growth, from 17% to 12%, to users shifting to AI search, which forces the company to keep spending heavily to avoid falling behind. The discussion added that headline inflation may ease as oil prices, which started rising in March, stop climbing, though the timing of a slowdown in nominal GDP remains unclear.
Summary written by Upside AI from the original article. Read the source for full details.
Read the original on Yahoo Finance ↗
Keywords
Fedinflationinterest ratesGDP growth
Open a keyword to see other news on the same topic.
Related tickers and likely impact
QQQ
▼ Likely negativeInvesco QQQ Trust
Relevance: medium
| Market | US stocks |
|---|---|
| Sector | ETF |
| Close on 10/28/2026 | 725.59 |
| Change that session | +0.60% |
SPY
▼ Likely negativeSPDR S&P 500 ETF
Relevance: medium
| Market | US stocks |
|---|---|
| Sector | ETF |
| Close on 10/28/2026 | 772.35 |
| Change that session | +0.35% |
DXY
▲ Likely positiveRelevance: low
| Market | Currencies |
|---|---|
| Close on 10/28/2026 | 102.14 |
| Change that session | -0.22% |
XAU/USD
▼ Likely negativeRelevance: low
| Market | Gold |
|---|---|
| Close on 10/28/2026 | 4,067.54 |
| Change that session | +0.18% |
Impact is scored by AI from the headline and may be wrong. It is not investment advice.
Related news
- US GDP Unexpectedly Beats Forecasts, Inflation Gauge Stays Elevated, Probability of Fed Rate Hike Rises to 84.6%
US GDP grew 3.4% in Q3 2026, above the 3.1% forecast and up from 2.2% in Q2. According to Fwdbonds chief economist Chris Rupkey, the growth was driven by AI infrastructure investment and sustained consumer and government spending. PCE rose 0.5% in September, lifting annual inflation to 3.6%, while core PCE rose 3.1% year over year, keeping pressure on the Fed. The Fed held its benchmark rate at 3.75%–4% one day before these data were released, and initial jobless claims fell to 194,000. According to CME Group's FedWatch tool, markets put the probability of a Fed rate hike at the December meeting at about 84.6%.
- The Economy Could Be Growing Too Fast for Warsh
The Fed held its target range at 3.75% to 4% on October 28, 2026, in a 10-2 vote, with Lisa D. Cook and Beth M. Hammack favoring a 25-basis-point hike. Chair Kevin Warsh said first-half GDP was revised up to 2.4% from 1.8% and third-quarter growth is likely above 3%, but pushed back on the idea that the economy is overheating. The Atlanta Fed's GDPNow stood at 3.3%, and a futures-based measure put the odds of a December hike at 86.0%. Headline PCE inflation was 3.4% in August and core was 3.0%, mostly tied to energy and core goods affected by the Middle East conflict and tariffs, which rate hikes do little to address. SPY is up 13.26% year to date, but its large tech holdings make it sensitive to a 10-year yield above 5%, and its outlook weakens if September core PCE tops 0.3% or the yield passes its October 5 high of 5.31%.
- Third-quarter U.S. GDP increases a better-than-expected 3.4% as September inflation accelerates
The Commerce Department reported that U.S. GDP grew at a seasonally adjusted annualized pace of 3.4% in the third quarter, above the 3.1% estimate and well up from 2.2% in the second quarter. Consumer spending rose 0.5%, slightly below the forecast of 0.6%, while personal income increased 0.2% against a forecast of 0.3%. The same day, the personal consumption expenditures (PCE) price index rose 0.5% in September from the prior month, lifting annual inflation to 3.6%; the monthly rate matched the Dow Jones consensus, while the annual rate was 0.1 percentage point below consensus. Core PCE, which excludes food and energy, rose 0.3% monthly and 3.1% annually, in line with consensus. A day earlier, the Fed held its benchmark rate in a 3.75%-4% range, and Chairman Kevin Warsh said officials want to assess incoming data before deciding their next move.
- The Fed held off on a rate hike. Today’s GDP and inflation reports could make waiting harder.
- Fed Holds Rates Steady Despite Rising Inflation, Two Officials Push for Immediate Hike
The Fed kept its benchmark rate at 3.75-4% after its October 28 meeting, saying inflation remains elevated and more data is needed to return it to the 2% goal. The decision was not unanimous: Governor Lisa Cook and Cleveland Fed President Beth Hammack dissented, preferring a 0.25 percentage point increase. Inflation has been above the Fed's 2% target for more than five years, and the PCE index is forecast to exceed 3% in September even excluding food and energy. The U.S. economy remains resilient, with low unemployment, steady consumer spending and AI investment supporting growth; the Atlanta Fed's GDPNow forecasts third-quarter GDP growth of 3.4% annualized. Observers are watching the November 3 midterm elections, while futures markets lean toward a rate hike in December.
- Inflation , earnings reports and the mood of consumers and the Federal Reserve fill out a busy week
This week brings a busy slate of data on inflation, corporate earnings, consumer confidence and the Federal Reserve, just weeks before the Nov. 3 midterm elections. Consumer confidence fell in September to its lowest level in more than a decade and is expected to keep weakening in October as higher gas and grocery prices squeeze budgets. The Fed is expected to hold its benchmark rate steady after a hike in September, though it remains worried about inflation, and Wall Street still expects one more hike in December. Third-quarter GDP is forecast to rise 1.7%, slower than 2.2% in the second quarter. The PCE inflation gauge, the Fed's preferred measure, is expected to jump to 3.7% from 3.4% in August, as the U.S. war with Iran squeezes global oil supplies.
Related markets
Latest news
- Want Income for Life? Philip Morris International Yields 3.2% and Has the Kind of Competitive Moat That Makes the Income Durable.
Philip Morris International yields 3.2% and has raised its dividend every year since its 2008 listing, with its latest increase at 8.8%. Its cigarette volumes held flat in the third quarter of 2026, while Altria's domestic cigarette volume fell 3.2%, and organic gross profit from combustibles rose 7.4% on pricing power. Reduced-risk products such as oral nicotine pouches, vapes and heat-not-burn devices accounted for 42% of net revenue in the first nine months of 2026. The company's cash payout ratio is about 67%, and free cash flow has trended upward despite heavy investment in Swedish Match and Zyn capacity. Analysts expect earnings to grow nearly 9% a year over the next three to five years.
- Alphabet: 3 Key Takeaways for Long-Term Investors
Alphabet reported third-quarter 2026 revenue of $127.6 billion, up 25% year over year, as demand grew for custom hardware and cloud services amid scaling AI tools. Google Cloud revenue rose 103% to $30.7 billion, with elevated demand for TPUs and 18 product lines each generating over $1 billion in annual revenue. Search query growth reached its highest rate in five years as users adopted generative AI tools, and ads are being integrated into these search interfaces. Full-year 2026 capex guidance of $195–205 billion was unchanged, with 65% of infrastructure spend going to servers and networking hardware with estimated six-year useful lives, and capex is expected to rise significantly in 2027. Management said it expects ROIC to remain meaningfully above its cost of capital throughout this investment cycle.
- AMD Has Ripped 170% This Year: Is It Too Late to Buy?
AMD stock is up 170% in 2026, driven by two record data center quarters and a Meta deal for up to 6 gigawatts of Instinct GPUs. Second-quarter revenue rose 50% to $11.5 billion, data center sales more than doubled to $6.7 billion, and AMD guided to about $13 billion for the third quarter. Analysts expect normalized EPS to rise from $7.61 this year to $15.85 in 2027, while the forward P/E has fallen from a 67x peak to 50x. The author sees the main risk as AMD helping fund some of its own demand through a lease guarantee, up to $5 billion pledged to Anthropic, and warrants of up to 160 million shares apiece for OpenAI and Meta. The author judges AMD isn't too late to buy, with the Nov. 3 report as the key test.
- Crocs Lifts Outlook as Growth Shifts Overseas: Rapid Earnings Reaction
Crocs raised its full-year outlook for a third consecutive time as quarterly revenue rose 4.6% to $1.04 billion, helped by overseas growth and a return to growth at HEYDUDE. Adjusted operating income grew 11.7%, and adjusted gross margin rose to 60.3% from 58.5%. A one-time $64 million tariff refund was excluded from adjusted earnings, while adjusted diluted EPS grew 26.4% to $3.69, helped by a diluted share count down about 11%. Crocs brand revenue rose 4.4% to $873 million, with international up 11.8% and North America down 2.1%; HEYDUDE revenue rose 6.1% to $170 million. Management now expects full-year revenue growth of about 3%, up from 1% to 2%.
- Palo Alto Soars 14% in a Week as CEO Warns of AI’s “Nuclear Sort of Bomb”
Palo Alto Networks (PANW) stock rose 14% over the past week while the S&P 500 was roughly flat, as AI helped uncover software flaws and an Evercore survey showed security budgets firming. The broader cybersecurity group rallied too, with CrowdStrike (CRWD) up 11%. The author argues the valuation is already full: the forward P/E reached 96x on Oct. 27 versus a five-year average of 57x, and the stock closed Oct. 28 just under the $399 average analyst target. The main risk cited is that major AI players, such as Amazon with AWS Continuum, may sell defensive tools themselves. The author says the fiscal first-quarter report, which will test next-generation security ARR, is the key event, and rates the stock as a hold for now.
- Why FTAI Aviation Stock Popped on Thursday
FTAI Aviation (FTAI) shares rose 14.61% after the aircraft leasing company reported third-quarter results, with revenue of $977.7 million, up 46.6% year over year, and profit of $150.6 million, up 28%. EPS rose 30% to $1.43, a pleasant surprise for investors who had sold the stock this year, though the shares are still down 10% over the past year. FTAI doubled its buyback authorization to $1 billion, which could retire more than 6% of shares outstanding if fully executed. The author is skeptical, noting the company had about $386 million on its balance sheet against more than $3.45 billion of long-term debt and burned nearly $516 million in negative free cash flow in the first half, per S&P Global, so buybacks would likely require more borrowing.
Get the briefing on Telegram or Zalo
Join the Upside Telegram channel or Zalo group for the Vietnam stocks and gold briefing at 8:00 and 19:00 (Vietnam time) on trading days, plus a weekly wrap on Saturday morning.