A New Hiking Cycle, a Confirmed Trump-Xi Summit, and a Costco/Darden Collision on Thursday
Markets are digesting last week's first Fed hike since 2023 and a hawkish dot plot that erased the rate-cut path from earlier this year. This week's calendar is light on data, but Thursday stacks a confirmed Trump-Xi state visit against earnings from Costco and Darden Restaurants, with AutoZone opening the week's reports on Tuesday.
Week at a Glance
Week Highlight
Confirmed US-China Summit, Thu
Fed Aftermath
New Hiking Cycle Begins
Consumer Bellwethers
AutoZone Tue · Costco & Darden Thu
Market Backdrop
Post-Hike Repricing
01 · MACRO
A new hiking cycle, and a confirmed summit
The Fed's unanimous 25bp hike last week came with a hawkish dot plot pointing to more increases into 2027. President Trump and President Xi are now confirmed to hold a state-visit summit in Washington on Thursday, the first Chinese state visit to the US since 2015.
02 · EARNINGS
Three consumer bellwethers carry a light week
AutoZone reports Tuesday before the open after a strong fiscal third quarter. Costco and Darden Restaurants both report Thursday — Costco after the close on its tariff-refund pledge, Darden before the open against its newly issued fiscal 2027 guidance.
03 · CONSUMER & GLOBAL
Durable goods and sentiment close the week
Friday's Durable Goods Orders and final September University of Michigan sentiment reading offer an early look at how households and businesses are reacting to a higher-for-longer rate path, after preliminary September sentiment already dropped sharply.
All times below are U.S. Eastern Time (ET). Company earnings are marked BMO (before market open) or AMC (after market close); call times, when they differ, are listed separately.
Macro Context
On September 16 the Federal Reserve delivered its first rate hike since 2023, a unanimous 12-0 vote lifting the federal funds target range 25 basis points to 3.75 to 4.00 percent. The updated dot plot was more hawkish than June's, with a median projection of 4.1 percent for both year-end 2026 and 2027, essentially erasing the rate-cut path the Fed had signaled as recently as March. Sixteen of 18 officials see at least one more hike this year, and four of those see two more as possible. CME's FedWatch tool was last pricing roughly 95% odds of another quarter-point hike at the Fed's October 28 meeting and about 64% odds of a further hike in December.
This week's biggest scheduled event isn't economic data at all: President Trump and President Xi are confirmed to hold a state-visit summit in Washington, DC on Thursday, the first Chinese state visit to the US since 2015, with trade, AI competition and Taiwan among the agenda items reported ahead of the meeting. On the earnings side, the calendar is light but Thursday is crowded: AutoZone reports Tuesday before the open after a strong fiscal third quarter, and Costco reports Thursday after the close — the same day as the summit and the same day Darden Restaurants reports before the open against the fiscal 2027 guidance it issued in June. Durable Goods Orders and the final September University of Michigan sentiment reading close out the week Friday.
S&P 500, daily close · Sep 3–17, 2026 (Actual). The index posted its period low the day the Fed announced its hike, then recovered most of that move the next session, entering this week roughly flat versus three weeks earlier.
Y-axis spans 7,500–7,800 (about 4%) to keep day-to-day moves legible — not the index's full historical range. FRED's SP500 series had not yet posted a September 18 close at fact-check time, so September 17 is the latest close shown.
SOURCE: FRED, S&P 500 (series SP500), Federal Reserve Bank of St. Louis
MON
09.21: Quiet Open
All Day
No Major Earnings or Data ConfirmedThe week's main events land Tuesday through Thursday; see below.
TUE
09.22: AutoZone, Thor Industries & KB Home
BMO ★
AZO: AutoZone, FQ4 2026Auto aftermarket retail. Call 10:00 AM ET. See spotlight below.
BMO
THO: Thor Industries, FQ4 2026RV and outdoor-recreation manufacturer, unrelated to auto retail or homebuilding.
STORE COUNT (ACTUAL, AUG 29)8,031 across the Americas
CALL TIME10:00 AM ET
What Matters
AutoZone's fiscal third quarter (ended May 9) beat on continued strength in commercial sales and its Mega-Hub distribution buildout, against the secular tailwind of an aging US vehicle fleet. Tuesday's FQ4 report, covering the quarter ended August 29, is the read on whether that momentum held through the summer driving season; the company does not issue formal quarterly guidance, so there is no prior number to check results against beyond the FQ3 base above.
AUGUST COMP SALES (ACTUAL)+8.4% total, +5.4% ex-gas/FX
CEO COMMENT (Q2 FY26 CALL)"First to lower prices, last to raise them" — Vachris
What Matters
CEO Ron Vachris told investors on the fiscal Q2 call that Costco aims to be "first to lower prices and the last to raise them," and the company has said IEEPA tariff refunds would flow back to members as lower prices rather than pad margins — a management expectation, not a formal guidance figure. That reframes how to read Thursday's gross margin. The freshest actual data point is August's four-week comp sales print: +8.4% total and +5.4% ex-gas/FX, a deceleration from fiscal Q3's +9.8%/+6.6%, though Costco's own release attributes roughly 75 basis points of that August slowdown to a later Labor Day shifting the calendar, not softer demand.
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Key Earnings Charts
Darden Restaurants reports fiscal Q1 2027 Thursday before the open, the first test of the fiscal 2027 outlook it issued alongside fourth-quarter results in June. Both figures below come from that same Darden Restaurants IR release.
Darden same-restaurant sales growth (%), Q4 FY2026 Actual vs. FY2027 Guidance. Thursday's Q1 FY2027 print is the first read on whether Darden can hold within, or above, the 2.5%–3.5% range it guided for the full year after posting 4.6% growth in the quarter just ended.
Darden total sales ($B), FY2026 Actual vs. FY2027 Outlook. The guided range implies roughly 3%–4% total sales growth for fiscal 2027, before Thursday's first-quarter print shows how the year is tracking.
Y-axis runs $0B–$15B, starting at zero. The hatched "guided growth" segment equals the midpoint of Darden's FY2027 sales guidance ($13.60B–$13.75B, issued June 2026) minus FY2026 actual sales ($13.21B); it is our calculation for illustration, not a company-reported figure, and actual FY2027 growth will depend on where results land within the guided range.
The dot plot's median of 4.1% for both 2026 and 2027 marks a sharp reversal from the rate-cut path projected as recently as March. Sixteen of 18 officials see at least one more hike this year, and four see two more as possible — a genuine regime change in Fed communication.
Geopolitics
A Confirmed Trump-Xi State Visit
What had been speculative is now a confirmed Thursday summit in Washington, the first Chinese state visit to the US since 2015, landing on the same day as Costco's and Darden's earnings.
Consumer Retail
Costco's Tariff-Refund Test
Passing savings through as lower prices is good for members but complicates margin analysis. August's actual ex-gas/FX comp of +5.4%, not gross margin alone, is the cleaner read on demand heading into Thursday.
Auto Aftermarket
AutoZone's Aging-Fleet Tailwind
Commercial sales growth and Mega-Hub expansion drove FQ3's +5.5% same-store sales. Tuesday's FQ4 report tests whether that held through the peak summer driving season.
Rates & Markets
Higher-for-Longer Repricing Continues
CME FedWatch was last pricing roughly 95% odds of an October hike and about 64% odds of a further hike in December, a genuinely different environment for rate-sensitive sectors than in June.
Sentiment
UMich Closes the Week
The preliminary September reading already fell to 47.8 from 51.7 in August; Friday's final revision is an early gauge of whether sentiment keeps sliding as the higher-for-longer rate path sets in.
Figures marked ACTUAL are historical results as reported. Figures marked GUIDANCE or attributed to management on an earnings call are forward-looking company statements, not achieved results. Third-party analyst estimates, price targets and implied-move figures have been omitted where they could not be verified against a primary source.
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