September 30, 2026

US inflation growth slows more than expected. Yet interest rates did not fall | 5-minute morning US stock memo

PCE came in below expectations, and Micron reported earnings that beat estimates. The Nikkei rose 1,272 yen, and this morning we have the Tankan survey from the Bank of Japan

Good morning, this is Rin. Let’s start our morning market preparations together again today.

Today’s conclusion

The PCE, a price index closely watched by the Fed, was +3.4% which was lower than the forecast (+3.7%). Normally, this would be content that tends to lower interest rates, but the US 10-year Treasury yield
5.284% and the Dow was -0.86%. The Nasdaq was +0.24% and the S&P 500 was mostly flat. Micron’s earnings, released after the close, exceeded expectations for both revenue and profit. In Tokyo yesterday, the Nikkei Stock Average
rebounded significantly to 66,753.72 yen, up 1,272.45 yen. This morning at 8:50 AM, the Bank of Japan Tankan survey will be released.

Yesterday’s check points, here is how they turned out

① Will the Nikkei average recover to the 66,000 yen level indicated by futures and close there? → It recovered. 66,753.72 yen (+1,272.45 / +1.94%). It rebounded for the first time in three days. Saudi Arabia’s pipeline partially resumed, causing crude oil to fall, and AI/semiconductor stocks were bought.

② Will the TOPIX rebound from the previous day’s -1.72%? → It rebounded.. 4,108.65 (+67.52 / +1.67%). It was a broad rally with all 33 sectors on the Tokyo Stock Exchange rising.

③ Will Japanese oil and resource stocks fall following crude oil dropping below $90? → They did not fall. Because all 33 sectors rose, oil and resource stocks were also bought. The power of the market-wide buyback outweighed the drop in crude oil prices.

※ Nikkei 225 futures are about 280 yen higher than the cash closing price this morning.

Three important news items

① Factors that moved the entire market

The August PCE price index was +3.4% which was lower than the forecast of +3.7%. The core index, excluding volatile food and energy, was +3.0% (forecast +3.3%). The September ADP employment report was
+90,000, exceeding the forecast (+68,000), and employment remains firm. Although inflation growth slowed, the US 10-year Treasury yield rose to the 5.28% range, and it was a day where stocks also struggled to gain upside. It suggests that the market sees that “even if inflation settles, it does not necessarily mean that interest rate hikes will stop immediately.”

② Sector/Theme: Micron earnings

Micron’s June-August earnings showed revenue of $54.2 billion (forecast $51.1 billion), and earnings per share of $33.42 (forecast $31.61), both exceeding expectations. Demand for memory for AI data centers is strong, and a state where price increases are easily accepted continues. Contracts with major customers for long-term price agreements have also increased to 17. However, the stock price was mostly flat in after-hours trading, suggesting that “good earnings were already priced in.”

③ Factors likely to affect the Japanese market

In Tokyo yesterday, crude oil fell as Saudi Arabia’s major pipeline partially resumed, easing anxiety about the Middle East. The Nikkei average rose by 1,272 yen, all 33 sectors on the Tokyo Stock Exchange rose, and about 73% of stocks
increased in price.
The Japanese 10-year Treasury yield also fell from the previous day to 3.051%. Since the Bank of Japan Tankan survey will be released at 8:50 AM this morning, corporate business sentiment will be the next factor.

Impact on the Japanese market

Sectors likely to be tailwinds: Semiconductor and memory-related stocks following Micron’s strong earnings, major large-cap stocks following the rise in futures, and real estate due to the decline in Japanese interest rates.
Sectors likely to be heavy: High-PER growth stocks with US interest rates in the 5.28% range, and profit-taking selling is also likely to emerge in some of the stocks that rose significantly yesterday.
Points to check after the opening bell:
- Will the Nikkei 225 close above the 67,000 yen level indicated by futures? (Futures 67,037.5 yen)
- Following the Tankan survey, will Japan’s 10-year bond yield reach the 3.1% level? (3.051% as of 3:00 PM on the 30th)
- Following Micron’s earnings, will Japanese memory-related stocks like Kioxia be bought?

Today/This Week’s Schedule

Today (Thursday, October 1)

Japan: BOJ Tankan Survey (September survey) (8:50 AM). Earnings announcements are scheduled for 6 companies.
US: ISM Manufacturing Index (September), Initial Jobless Claims
Fed-related: Speeches by Fed officials will continue.

From tomorrow onwards

October 2 (Friday): US Employment Report (September) . Earnings announcements in Japan are scheduled for 13 companies.
October 5 (Monday): Earnings announcements in Japan are scheduled for 13 companies.

* The ISM Manufacturing Index is an indicator showing the business conditions of US factories; a reading above 50 is interpreted as “expanding business conditions.”

Today’s 30-Second Explanation

What is the BOJ Tankan?

It is a survey conducted by the Bank of Japan every three months, asking approximately 10,000 companies nationwide whether business conditions are “good” or “bad.” The figure obtained by subtracting the percentage of companies that answered “bad” from the percentage that answered “good” (Business Conditions DI) is closely watched. It is one of the important materials the BOJ uses when considering monetary policy.

📖 You can read past 30-second explanations one by one in the app (the days you read them will be marked on the calendar) https://rincanvas-hash.github.io/okane-kuse/

Today’s NISA Perspective

It is October starting today. This is a time when many people have their accumulation purchases at the beginning of the month. Since accumulation involves buying a fixed amount on a fixed day, you end up buying less in months when stock prices are high and more in months when they are low. Even with large ups and downs like yesterday, it is a mechanism where you don’t have to judge based on a single day’s movement.

Rin’s Word

Even though inflation growth slowed more than expected, interest rates rose and the Dow fell. It’s a bit confusing when the numbers and the market’s reaction don’t align, isn’t it? Yesterday in Tokyo was a strong day with all sectors rising. Today is the Tankan, and tomorrow is the employment report. When the numbers come out, let’s start by looking at how they compared to expectations.

* Source: TheStreet / Zaikei Shimbun (FISCO)

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Disclaimer

*This is not investment advice, but a personal information organization memo. Please make your own investment decisions.

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