Wednesday, 2:00pm: the Fed decides | Week-Ahead Brief #6

The week in one minute

Wednesday, 8:30am ET: August retail sales, five and a half hours before the rate decision. July fell 0.6%.
Wednesday, 2:00pm ET: the Fed decides. A quarter-point rise to 3.75%-4.00% is priced at roughly 85-90%. Chair Warsh takes questions at 2:30pm. Live coverage at Regards of Wall Street.
The dot plot publishes in the same release. June's year-end median was 3.8%, which Wednesday's hike will satisfy. Anything beyond that (e.g., new higher median) is unpriced.
Lennar reports earnings Wednesday after the close, the only large US company to report of the week.
Thursday, 7:00am ET: the Bank of England rate decision. The Bank of Japan follows overnight into Friday.
Friday is quad witching, and the S&P 500 rebalances - 3 companies join, 3 leave.

The week, day by day

Every confirmed report with its session is on the earnings calendar. Each morning's running timetable is on /today.

Monday, Sep 14

No US data. Before the open: Hain Celestial. After the close: Dave & Buster's, where options price a 17.5% move on an $8 stock.

Tuesday, Sep 15

The FOMC convenes. Nothing is announced.
8:30am ET: Empire State manufacturing. 1:00pm ET: a 20-year Treasury auction.
After the close: Trip.com.

Wednesday, Sep 16

8:30am ET: August retail sales.
2:00pm ET: the Fed decision, the statement, the dot plot and the full Summary of Economic Projections
2:30pm ET: Warsh's press conference.
4:45pm ET: Lennar, with the call Thursday morning.

Thursday, Sep 17

7:00am ET: Bank of England. Bank Rate is 3.75%, and a hold is widely expected. Three members out of nine voted for a rise in July.
8:30am ET: housing starts, building permits, weekly jobless claims and the Philadelphia Fed survey, all at once. 10:00am ET: pending home sales.
Overnight into Friday: the Bank of Japan, which went to 1.00% in June and held in July. Raise expected.

Friday, Sep 18

Quadruple witching. Volume and volatillity runs well above normal.
The S&P 500 rebalance trades into the closing auction, effective before Monday's open.

The full macro list is on the economic calendar.

Wednesday is the whole week

The hike is not news anymore - being almost fully priced in. Pricing on a quarter-point rise sat near 85-90% at Friday's close, up from about 70% the day before. A move the market has already bought and will not move it further. What arrives at the same instant, and is not priced, is the projection table (dot plot).

June's median was a tie. Nine officials voted in at least one 2026 hike, eight wanted none, and one wanted a cut. That produces a 3.8% year-end median, which is not a rate any single person can vote for. It is the midpoint between eight dots at 3.6 and nine at 3.9.

Once the Fed announces its decision at 2:00pm, we start looking at what the Fed thinks rates will look like in 2027. In March, the Fed's median forecast for the end of 2027 was 3.1%. By June, it had raised that to 3.6%, meaning it expected fewer rate cuts next year than it had previously.

Since that June forecast, oil prices have risen. Higher energy prices can keep inflation higher, which makes it harder for the Fed to cut rates.

So if Fed officials now think energy prices will keep adding to inflation, you would expect their 2027 interest-rate forecast to move above 3.6%.

The dot plot preview has the full grid, and the Fed hub has tracked every move in the odds since Jackson Hole.

Retail sales at 8:30, the vote at 2:00

July's report fell 0.6% to $763.6 billion against forecasts for a small rise, and the control group that feeds GDP fell 0.5%. Strip out online sales and the rest of the group rose - so the drop didn't concern traders too much.

Two soft months in a row would start to concern traders. It would leave the Fed raising rates into a household sector already pulling back.

Worth remembering how Friday went, because it sets the mood: Core August CPI ran hot, up 0.3% against a 0.2% forecast, with the annual rate easing only to 2.4%. Headline held at 3.4%, with oil/gas suppling over a third of the monthly rise, and stocks went up anyway. Brent fell close to 3% on the day, and the market cared more about cheaper oil next month than hotter inflation last month. The CPI hub has the full breakdown.

Lennar, hours after a rate rise

Analysts want $1.30 a share on $8.37 billion, against $2.00 a year ago. Options price a move near 7%.

Homebuilders are the clearest read on what mortgage rates have already done to housing demand, and we find out right after the Fed raises them again. The number to watch will be what Lennar is paying in incentives to keep buyers buying, because builders often absorb higher rates through discounts before sales volumes start to fall.

Friday: a lot of stock changes hands

Bloom Energy, Illumina and Everpure join the S&P 500. Molson Coors, The Trade Desk and Builders FirstSource drop out, per S&P Dow Jones Indices. Index funds have to own the new names and sell the old ones, and most of that trades in one auction at Friday's close.

Two things worth knowing about that flow. It is price-insensitive, so the moves it creates carry no view about any of these businesses. And it is well known and expected, so most of the repositioning is already done by Friday.

Separately, Sandisk joins the S&P 100 in the same reshuffle, which is a long way from where that stock was in the spring.

Scorecard

Twelve calls, 9 right, 75%. It is in the September 7 scorecard.

The three losses shared one mechanism: Shopify, Eli Lilly and Applied Materials each cleared the exact bar this site set before the print. Shopify grew gross profit 31% against a mid-20s guide. Lilly raised the full-year guide. Applied's CFO confirmed the 30%-plus systems trajectory on the call. All three conditions were met...and all three positions are now down a few weeks later: SHOP 12.98%, AMAT 8.56%, LLY 5.05%.

So the theses were right about the prints and wrong about the direction over the month.

The passes were the winners. Watching from the sidelines on Unusual Machines, Reddit and Rumble beat all three of the longs: those names fell 29.76%, 13.02% and 16.25% from where the calls were struck. Circle was the cycle's biggest mover at +46.3%.

Twenty-three positions stay open. Every entry, expected move and outcome is public in the track record.

New on the site

The FDA calendar updates and bug fixes based on your feedback. See it here.

And there is now a permanent page for the next CPI date: when the next CPI report lands.

Read this week

September 16 Fed meeting: hike odds and the runway
August CPI, the print that set Wednesday up
The dot plot: nine hike dots, none of them Warsh's
Sector heatmap, for where Wednesday afternoon shows up first

Last thing

The quarter ends in two weeks, and with it the next round of the SpaceX lock-up: the day-105 tranche releases on September 24. The lock-up calendar has the dates and the share counts.

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