Stocks closed lower again yesterday. Same story as the day before -- oil prices gained and Treasury yields rose.

Crude oil shot up 7% yesterday with Brent closing at $108.23. And is now just 10% below its conflict peak from April.

Treasuries rose as well with the 2-year reaching their highest level in more than 2 years, the 10-year rising to its highest level since 2023, and the 30-year hitting their highest level in 19+ years.

Yesterday's hotter-than-expected Producer Price Index (PPI?wholesale inflation) only exacerbated the rising yields.

Headline PPI was up 0.4% m/m vs. last months' 0.1% and views for 0.4%. The y/y rate was up 5.4% vs. last month's 4.8% and estimates for 5.3%. The core rate (ex-food & energy) was up 0.2% m/m vs. last month's 0.3% and forecast for the same. The y/y rate came in at 4.6% vs. last month's 4.2% and the consensus for 4.6%. Everyone expected the headline rate to be up given the rise in oil prices. But the core rate increase, while expected, does underscore the concern that inflation is too high and has stopped falling.

This morning we'll get another look at inflation with the Consumer Price Index (CPI ? retail inflation) report. This one is forecasting very little change (even a slight decrease) with the headline m/m rate at 0.4% vs. last month's 0.1%, and the y/y rate at 3.4%, which is in line with last month. The core rate is expected to come in at 0.2% m/m, in line with last month, while the y/y rate eases to 2.4% vs. last month's 2.5

If so, it will show that inflation is still too high. But that higher producer inflation is only partially making its way to the consumer.

Next week (Wednesday, 9/16), the Fed makes their next FOMC Announcement. After yesterday's PPI report, the probabilities for a 25-basis point rate increase have risen to 71.1%, up from 50% less than 2 weeks ago.

In other news, yesterday's Weekly Jobless Claims fell -1,000 to 206,000 vs. the consensus for 208,000.

And existing Home Sales rose to 3.98 million units (annualized) vs. last month's 4.06M and estimates for 3.97M. On a m/m basis it was down -2.0%. On a y/y basis it was down -1.2%.

In addition to today's CPI report, we'll also get the Baker Hughes Rig Count Report, and the always important Consumer Sentiment Report (as a happy and confident consumer is a consumer who spends -- and since roughly 70% of GDP comes from consumer spending, it's a number to watch).

With one more day to go in this shortened trading week, all of the major indexes are poised to close lower for the week. A good CPI report today could change that. Or at least mitigate some of that. And any other type of good news could help as well.

Short of that, it's looking like a down week.

But I'm still expecting a lot more upside to go by year's end.

Best,