Europe Got an Inflation Scare. The Ten-Year Barely Moved

Brad Roth
October 05, 2026

TL;DR

• Euro-area producer prices rose 8.2% from a year ago, up from 5.8% in July. The euro fell 0.43%, and the ten-year here eased 1 basis point to 5.270%.

• Index futures are slightly lower after a Friday when ten of eleven sectors rose. ISM services lands at 10:00, expected at 55.1.

• The even-weight strategy holds technology, healthcare and financials near a fifth each. The other 40.4% sits in Treasury bills yielding about 4.1%.

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Market Pulse

Futures as of 7:09 to 7:10 AM ET, rates and currencies as of 7:20 to 7:25 AM ET, commodities as of 6:44 AM ET

• S&P 500 futures are down 0.12% at 7,768.00.

• Nasdaq 100 futures slip 0.23% at 30,989.50.

• Dow futures are down 0.13% at 51,409.00.

• Russell 2000 futures are flat at 2,850.80.

Friday finished well. The S&P 500 gained 0.73% and the Nasdaq Composite 1.19% after September payrolls came in at 29,000. Ten of eleven sectors rose. Consumer discretionary led at 1.13%, then technology at 1.01%. Healthcare was the only decliner, down 0.01%.

• West Texas trades $90.75, down 0.40%. Brent is $102.93, up 0.67%.

• Gold is $4,187.22, up 0.60%. Silver jumped 2.69% to $62.04, and copper is up 0.66%.

• The three-month bill yields 4.108%, the two-year 4.806%, the ten-year 5.270% and the thirty-year 5.624%.

• Euro/dollar is 1.1204, down 0.43%. The dollar buys 158.19 yen. Volatility futures are 17.65. Bitcoin trades $86,024, down 0.58%.

• Germany's DAX futures are up 0.15% and the Nikkei 0.32%. China is closed for National Day.

• S&P Global's services PMI lands at 9:45 and ISM services at 10:00. Treasury auctions three- and six-month bills at 11:30.

THOR Risk Gauge

Neutral. The index strategy is fully invested across all three major American indexes. The even-weight strategy holds 60.2% in three sectors and 40.4% in Treasury bills. Friday's broad gain and a calmer ten-year help. Brent above $102 and a week of long-bond auctions keep it from leaning further.

The THOR View

Europe got the inflation surprise this morning. Euro-area producer prices rose 1.9% in August and 8.2% from a year ago. Italy's services PMI fell to 51.7 against 54.6 expected, and investor confidence in the region slid to 2.7. The euro dropped 0.43%. American bonds took it in stride. The ten-year eased to 5.270% and the two-year to 4.806%, days after the ten-year touched its highest since 2002. That calm matters to the index strategy, which owns only American large caps. It holds the Nasdaq 100 at 34.1%, the S&P 500 at 33.2% and the Dow at 32.9%.

The quietest piece of the even-weight strategy is also its largest. 40.4% sits in Treasury bills, and the three-month yields 4.108%. Last week the ten-year swung between 5.157% and 5.344%. The bill fund moved 0.02% Friday. Bills mature in weeks, so their rate follows the Fed, not bond-market worries about Europe or deficits. The strategy owns sector trends that have confirmed, and the rest earns the bill rate. Right now that's three sectors: technology at 20.7%, healthcare at 19.8% and financials at 19.7%.

ISM services lands at 10:00, expected at 55.1 against 55.4 in August. Services are most of the economy, and the survey's employment piece read 47.8 last month. Anything under 50 means shrinking. Healthcare is the exception to that hiring picture. It added 17,000 of September's 29,000 jobs. Care gets delivered whatever the payroll number says, and the sector closed Friday 5.9% under its 52-week high. Technology rose 1.01% Friday and sits 0.78% under its own.

Signal Watch

THOR Index Rotation — As of 10/2/26

Fully invested, in three near-equal pieces. The Nasdaq 100 rose the most of the three Friday, and it's the largest line at 34.1%.

THOR Low Volatility — As of 10/2/26

Growth, defensive and rate-sensitive, each near a fifth. The bill sleeve collects the front-end rate while the long end does the swinging.

THOR AdaptiveRisk Dynamic — As of 10/2/26

The mix runs 45.4% equity, 18.9% alternatives, 14.6% commodity, 14.4% specialty currency and 6.6% fixed income. Same shape as Friday. The dollar-bullish fund is the leg tied most directly to this morning, with the euro down 0.43%.

One Thing to Watch

Treasury auctions three- and six-month bills at 11:30, after 4.110% and 4.285% last time. That's the rate new money in the bill sleeve rolls into, and the sleeve is 40.4% of the even-weight strategy. Ten-year notes follow Wednesday and thirty-year bonds Thursday.

Brad Roth / CIO, THOR Financial Technologies

This content reflects the opinions, analyses, and research of THOR Financial Technologies as of the date published. It is provided for informational and educational purposes only and does not constitute investment advice and should not be relied upon as the basis for any investment decision. Past performance doesn't guarantee future results, and all investments involve risk. For more information, please go to: thorft.com