Fed Hold, Midterms Test Wall Street Calm
Investors weigh Tuesday's midterm elections and Friday's jobs report after the Nasdaq Composite's worst month since March 2025.
Updated on Nov. 2, 2026 in Economic Indicators
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The Federal Reserve held rates last week, with two of its 12 voters backing a hike, while the Nasdaq Composite lost 2% and posted its worst month since March 2025. Oil rose more than 10% in October as West Texas Intermediate traded near $102 and Brent near $112 late Sunday.
Why it matters
A strong jobs report could lift rate-hike odds, adding pressure to risk assets already weighed by doubts over AI spending. Economists polled by Dow Jones expect October nonfarm payrolls to show 55,000 jobs added.
Two of the Fed's 12 voters backed a rate hike at last week's hold, and CME FedWatch priced an 84% chance of a December hike before the October decision. Economists polled by Dow Jones expect October nonfarm payrolls to show 55,000 jobs added, though the outcome of Friday's report remains unknown.
The players
Federal Reserve
The central bank of the United States, which sets benchmark interest rates and is led by a 12-member voting committee.
Kioxia
A Japanese maker of flash memory chips whose share price fell sharply Monday after its memory price gains slowed.
The details
Last week the Nasdaq Composite lost 2% and posted its worst month since March 2025, while the Dow gained almost 2% in October. Oil rose more than 10% in October, and Japan's Kioxia fell about 14% Monday as its flash memory price gains slowed to the mid-20% range last quarter from 70%.
Timeline
Last week: Fed holds rates and Nasdaq loses 2%.
Monday: Kioxia shares fall about 14%.
Tuesday: Midterm elections, with Democrats expected to win the House.
Friday: October nonfarm payrolls report due.
Macro View
The Fed's decision to hold, with two of 12 voters favoring a hike, follows the central bank's ongoing effort to balance inflation against growth. Current oil and equity moves are being read against that rate path rather than in isolation.
A strong jobs report could push up expected borrowing costs, affecting mortgage and loan rates for households. Higher oil prices, with WTI near $102 and Brent near $112, also feed directly into fuel and transportation costs.
The takeaway
Watch Friday's jobs report alongside the Fed's two hawkish voters, since a hot print could reprice December rate expectations quickly. Diversified positioning can help absorb swings in AI-linked stocks and energy prices.
What happens next
Friday's October nonfarm payrolls report will show whether the 55,000-job forecast holds, which could shift rate-hike expectations.
Further reading
For broader context on the data driving these moves, explore Economic Indicators.
Source note: This article includes information reported by BeInCrypto.
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