Diesel rose twenty four percent in a single month and the Fed decides next week whether that counts as inflation. Good morning and welcome to today's market chronicle. It's Friday, September 11, 2026.
Yesterday's close was the fourth down day in a row. The S&P gave back about six tenths of a percent, the Nasdaq a little more, the Dow a little less, and almost none of it was about equities. It was about the ten year, which added roughly eighteen basis points across the week and now sits a whisker under five percent, a level it last saw in 2023. Wholesale prices did the damage. August PPI printed 5.4 percent year over year against 4.8 in July, final demand energy rose 4.2 percent on the month, and diesel alone explained more than a third of the move in goods. Core PPI was 4.6 percent. Nobody put that one in a headline.
This morning's convention is that core CPI at half past eight arrives around two tenths, and two tenths settles the argument, because core strips out energy and energy is a war and wars are temporary. Diesel is the price of moving everything else. It turns up in produce, in furniture, in the cost of restocking a shelf in Ohio, on a lag of four to six months, at which point it is core inflation with a new name.
What I keep going back to is the insurance. War risk cover for a tanker through Hormuz ran about a quarter of a percent of hull value before February. It is now seven and a half to ten. On a hundred million dollar ship that is ten million dollars to make one crossing. Call it a toll. The underwriters are the only participants in this story who have repriced honestly. I read that number Wednesday and spent an afternoon hunting for the line item where it lands. There isn't one. Six thousand seafarers are stuck out there while the IMO negotiates routes, and I have yet to hear one desk mention them.
CPI at 8:30, then nothing. Futures are up about half a percent going in, which is an odd posture. Hike odds for Wednesday sit somewhere between sixty and seventy percent depending on which venue you believe, and Warsh has already said the committee has work to do, so I am unclear what the print is meant to change.
I closed Dominion Energy (D) yesterday. In at 68.06 on August 12, out at 65.05, down 4.4 percent against the S&P's 1.9 over the same twenty sessions, a little over two and a half points of underperformance. It went out on time rather than on the stop. Twenty trading days is this desk's maximum hold and Dominion reached it yesterday without ever being stopped out. The spread stayed thin the whole way, the fallback never got to work, and the clock ran.
Gold 4,347.78, Brent 104.41, Bitcoin somewhere near 78,000 (venues disagree by a few hundred and I would not build anything on the last digit), S&P futures around 7,630, the ten year 4.95 percent. Gold is up on the week and remains the least dramatic item on that list.
Something breaks at five percent. It always has.
Have a good one.
Salomon