Coming off a bombastic August nonfarm payrolls report that far exceeded expectations, investors step into a holiday-shortened trading week with all eyes on inflation data and earnings from the final hyperscaler of the cycle, Oracle (ORCL).

Two questions are set to lead the week: Will the data push the Fed toward a rate hike, and what can Oracle tell Wall Street about the state of Big Tech’s AI debt load?

The Nasdaq (^IXIC) was down 0.3%. The S&P 500 (^GSPC) was down 0.4%. And the Dow (^DJI) dropped 0.5%.

Coming off a jobs report that saw consensus move a bit closer to pricing in a rate hike from the Federal Reserve in September, investor attention will be focused squarely on Friday’s Consumer Price Index, set to give the FOMC a read on the state of inflation that has held above target for five years. Producer Price Index data on Thursday will offer a preview from the wholesaler side of the pricing equation.

In the corporate world, Thursday will be the day to watch, with earnings from Larry Ellison’s Oracle pulling focus. Given the company’s turn toward debt, quarterly results from Oracle tend to act as a bellwether on the state of AI financing. Adobe (ADBE) is also set to report on Thursday, coming off a fresh CEO change. Finally, Macy’s (M) results — also on Thursday — will provide a read on the state of the consumer.

Inflation data

Heading into Friday morning, bets were essentially split 50/50 on whether the Federal Reserve will issue a rate hike in September. The nonfarm payrolls report was expected to show 55,000 jobs added, a fairly middle-of-the-road, low-impact number.

Instead, the Bureau of Labor Statistics reported that the US economy added 162,000 jobs in August, far exceeding even the most bullish of Wall Street expectations — and yet bets on the Fed’s September meeting moved only marginally toward a rate hike.

The real test for Fed Chairman Kevin Warsh and the FOMC, economists and market-watchers say, will be this week’s inflation data, as Warsh has made price stability the singular focus of his Federal Reserve.

“For the Fed, the jobs report squarely focuses attention on inflation at the next meeting,” Bill Adams, chief economist at Fifth Third Commercial Bank, said in a note. “That next decision will be finely balanced. Next week’s releases of the August CPI and PPI reports have the power to swing it between a hike and a hold.”

That sentiment comes after comments from Warsh himself during his first keynote address at the annual Jackson Hole symposium. During that speech, the chair said the Fed’s 2% target for price increases was fixed, and that it’s the Fed’s duty to rein in inflation running hot.

“Price stability is not self-executing, nor is inflation necessarily mean-reverting,” Warsh said. “It is the Fed’s job to deliver stable prices.”

Inflation has now been running above that 2% target for roughly five years, and as Warsh’s comments throughout his public appearances have consistently focused on inflation, the question from investors has become: When are you going to do something about it?

We should get a decent idea of where that debate stands on Friday.

Oracle earnings

Big Tech will get its final real test of the quarter on Thursday when Larry Ellison’s debt-loaded hyperscaler reports earnings, where analysts will be looking for indicators on the company’s data center build-out and its financing strength.

The company’s shares have fallen by nearly 20% since the start of the year, and nearly 30% over the past 12 months. Much of that has been centered on concerns over the amount of debt Oracle has issued to fund its data center build-out. Yet despite the pullback and fiscal concerns, Bank of America analyst Tal Liani is bullish going into the earnings.

Oracle should report revenue growth for IaaS — “infrastructure as a service,” or renting of cloud computing capacity, storage, etc. — of 25% quarter over quarter and 116% year over year as Oracle “expands its data center footprint,” Liani wrote. The company’s infrastructure ramp should support revenue growth acceleration, and customer prepayments should ease some of the financing concerns that have dominated the narrative around Oracle, Liani said in his note.

“We favor the risk/reward of Oracle, as we believe Street consensus already captures the challenging balance sheet fundamentals,” Liani wrote on Friday, “yet is not fully incorporating the likelihood of revenue growth acceleration related to reaching DC buildout milestones.”

And don’t forget the software offerings, says Liani, even as most focus will be on Oracle’s infrastructure business. Bank of America is looking for Cloud SaaS revenue to have grown 12.8% in the quarter, compared to the last quarter’s 10.3% growth.

“While Oracle’s equity narrative is largely centered on the infrastructure business, we believe the company’s traditional software business remains an important component of the investment case,” Liani wrote.

Diesel crunch

US diesel prices raced up to an all-time high on Friday, crossing into new heights as wars in Iran and Russia-Ukraine keep structural pressure on an already tight market for the world’s “workhorse fuel.”

Prices on Friday climbed to $5.85 per gallon in the retail diesel market, per data from AAA, well surpassing the previous all-time high of $5.816 set in June 2022, months after the Russian invasion of Ukraine that kickstarted a major energy crunch in Europe.

Diesel is a critical fuel for the global economy, underpinning the world’s goods trade — from 18-wheelers driving products across the country to the fleet of cargo vessels that sustain the marine shipping market.

The US conflict in Iran has cut off the flow of refined products from the Persian Gulf, while attacks on oil refineries throughout Russia by the Ukrainian military have shuttered capacity from one of the world’s major diesel suppliers. The Middle East and Russia accounted for roughly a third of global diesel exports in 2025.

Here in the US, stockpiles of distillate fuels such as diesel and gasoline are at their lowest levels on record for this time of year, while on the East Coast — the primary driver of heating demand — stockpiles are at all-time lows. Those shortages have arrived just as the northeast region enters the winter heating season, when demand for fuel typically spikes as consumers turn up their heaters.

“US diesel prices have never been this high, and now the countdown starts for the trickle down to everything consumers buy,” Patrick de Haan, vice president of petroleum analysis at GasBuddy. “Record diesel will start funneling down into the economy.”

Economic and earnings calendar

Monday

Economic data: Labor Day, no notable economic data.

Earnings calendar: Labor Day, no notable earnings.

Tuesday

Economic data: NFIB small business optimism survey, August (99.2 expected, 99.8 previously); NY Fed 1-year inflation expectations, August (3.63% previously); Consumer credit, July ($12.97 billion expected, 14.17 billion previously)

Earnings calendar: Casey’s General Stores (CASY), FedEx Freight Holding Company (FDXF), GameStop (GME), VinFast Auto (VFS)

Wednesday

Economic data: MBA mortgage applications, week ended Sept. 4 (+0.8% expected); ADP weekly employment change, week ended Aug. 22 (+11,750 previously)

Earnings calendar: The Cooper Companies (COO), SailPoint (SAIL), Chewy (CHWY), AeroVironment (AVAV), Navan (NAVN), American Eagle Outfitters (AEO), Wealthfront (WLTH)

Thursday

Economic data: Initial jobless claims, week ended Sept. 5 (205,000 expected, 206,000 previously); Continuing claims, week ended Aug. 29 (1.78 million expected, 1.779 million previously); PPI final demand, month-on-month, August (+0.4% expected, +0% previously); PPI ex food and energy, month-on-month, August (+0.3% expected, +0.2% previously); PPI final demand, year-on-year, August (+5.2% expected, +4.7% previously); PPI ex food and energy, year-on-year, August (+4.6% expected, +4.2% previously); Existing home sales, month-on-month, August (-1.7% expected, -1.7% previously)

Earnings calendar: Oracle (ORCL), Adobe (ADBE), Macy’s (M)

Friday

Economic data: CPI, month-on-month, August (+0.4% expected, +0.1% previously); Core CPI, month-on-month, August (+0.2% expected, +0.2% previously); CPI, year-on-year, August (+3.4% expected, +3.4% previously); Core CPI, year-on-year, August (+2.4% expected, +2.5% previously); Real average hourly earnings, year-on-year, August (-0.1% previously); Real average weekly earnings, year-on-year, August (+0.1% previously); U. Mich. sentiment, September preliminary reading (51 expected, 51.7 previously); U. Mich. current conditions, September preliminary reading (51.5 expected, 51.9 previously); U. Mich. expectations, September preliminary reading (51 expected, 51.5 previously); U. Mich. 1-year inflation, September preliminary reading (+4% previously); U. Mich. 5-10 year inflation, September preliminary reading (+3.3% expected, +3.3% previously);

Earnings calendar: The Kroger Co. (KR), Rent the Runway (RENT)

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