Fed Governor Michael Barr to Address Housing Affordability

Federal Reserve Governor Michael Barr is scheduled to speak on housing affordability at the Federal Reserve Bank of Chicago later this morning. The speech comes as Chicago continues to lead major U.S. Cities in home price appreciation, a trend cited as a barrier for potential new homeowners entering the market.

Markets will also listen for any insights from Barr regarding the Federal Reserve's outlook on future interest rates. Last week's 25 basis point hike was the first increase of 2026, and a lack of forward guidance from Fed Chair Kevin Warsh contributed to mid-week market anxiety. Traders are questioning whether further hikes are planned for the final two FOMC meetings of the year.

Pre-market trading indicates a slight pullback in major indices, harvesting some near-term profits after a healthy week of gains on the Nasdaq and S&P 500. The AI trade has regained momentum amid a quiet period for economic reports, earnings, and Middle East developments.

Market Movements and Commodities

Early trading shows the Dow Jones Industrial Average down 174 points, the Nasdaq down 94 points, the S&P 500 down 11 points, and the Russell 2000 small-cap index down 17 points. Bond yields are edging higher, with the 10-year Treasury yield at 4.99%, maintaining a 20 basis point margin over the 2-year yield at 4.79%.

Spot oil prices have increased slightly. West Texas Intermediate crude is at $90 per barrel, while Brent crude has reached $100 per barrel.

Corporate Earnings Highlights

A handful of companies reported earnings this morning. Cracker Barrel posted a significant positive surprise, while General Mills met expectations but saw a muted market response.

Cracker Barrel's shares rose 6.8% in early trading, adding to its year-to-date gain of 79%. This follows a recent designation as 'Zacks Bull of the Day' by strategist Dave Bartosiak. General Mills beat earnings estimates by 3 cents and revenue expectations, yet its stock price remained flat. The company's shares have declined 23.8% so far in 2026.

Yesterday afternoon, homebuilder KB Home reported earnings of $1.05 per share on $1.3 billion in revenue, surpassing forecasts of $0.88 per share and $1.29 billion. Despite the beat, shares fell 3% in early trading as the company warned of headwinds, including higher mortgage rates, in the current quarter.

Economic Data on Deck

Flash S&P Manufacturing and Services Purchasing Managers' Index (PMI) data for September are due after the market opens. Both indices are expected to remain firmly above the 50 level, which indicates economic expansion.

The Manufacturing PMI is anticipated to tick up slightly to 53.5. The Services PMI is expected to reach 55.7, which would be 90 basis points lower than the previous month's report.

According to the source article from Zacks Investment Research, the publication's team of experts has also identified five stocks with high growth potential, with Director of Research Sheraz Mian highlighting one he believes is set to climb the highest. The article references past successes like D-Wave Quantum, which reportedly gained 680.1%.