The 10-year Treasury yield is up ~70 basis points off its spring low, headline CPI is running hot, and the market is starting to price in a Fed rate hike. But when you break the move apart, the story isn’t what the headlines say. In this week’s Inside Edge Capital market update, I walk through what’s really driving rates, whether the Fed is actually going to hike, and why energy stocks are up 46% this year while crude oil has gone nowhere — the crack spread.
What we cover:
– S&P 500 earnings revisions — Q3 2026 estimates vs. a typical year
– 10-year yield breakdown: breakevens vs. real yields (60 of the 70 bps came from real yields, not inflation expectations)
– Treasury supply and AI-driven corporate issuance competing for the same duration dollars
– The 2-year yield vs. fed funds spread as a rate hike predictor — with every tightening cycle since 1994 (1994, 1997, 1999, 2004, 2015, 2022)
– Sept 11 CPI preview: expectations for headline and core
– Why XLE is diverging from WTI crude
– Diesel, gasoline, and heating oil crack spreads — and which one is leading
– Upstream vs. midstream vs. downstream: how refiners like PBF Energy are levered to the crack spread, not the price of oil
