Inflation reports and a surge in the price of WTI oil pushed most major stock indexes lower for the week.

Market Overview: Stocks Pull Back as Oil Surges and Bonds Find Support

Market Index Performance: Last Week and Year-to-Date

Bonds Rise for a Second Straight Week

Let’s start with good news: core bonds, measured by the Bloomberg U.S. Aggregate Bond Index, rose in value for the second straight week, helping to offset the pullback in stocks.

The 10-Year Treasury yield has pulled back from its 2026 intraday high of 5.33% on October 14 to 5.09%. It is puzzling, as last week’s inflation reports did not provide confidence that overall inflation is taming. Perhaps the fact that we haven’t seen bond yields this attractive for some time has influenced investors to add to the asset class.

Inflation: CPI and PPI Offer Little Comfort

Last week, both the Consumer Price Index (CPI) and the Producer Price Index (PPI) were reported, and neither provided much comfort.

The CPI rose 0.6% for the month of September, with the annual rate now at 3.7%. Stripping out food and energy, CPI rose 0.3% for the month and 2.6% annually. Gasoline, to no one’s surprise, was a major contributor, rising 9.1% last month. New and used vehicles have now risen for three straight months, reversing the trend from earlier this year.

The PPI rose 1.3% in September and 6.3% over the last year. Without food and energy, the number was reported at 0.7% for the month and 5.0% for the year.

Earnings Season Begins with the Banks

Corporate profit season began with many major banks reporting. So far, 9% of S&P 500 companies have reported, with 84% beating earnings expectations, according to FactSet.

This Week: Corporate Earnings Take Center Stage

This week is light on economic data; however, 79 S&P 500 companies are scheduled to report, including:

Social Security COLA: Benefits to Rise 3.6% for 2027

For those collecting Social Security benefits, expect to see a rise of 3.6% beginning with your January 2027 check. According to the Social Security Administration, retirement benefits will increase by about $75 per month on average.

For those aged 62 or older who have not yet filed to begin receiving benefits, you benefit too. When you turn 62, the Social Security Administration calculates your baseline benefit (called your Primary Insurance Amount, or PIA). Every year when inflation moves higher, the government adds the COLA to your future benefit amount, even if your check hasn’t yet started. These yearly adjustments stack on top of each other as you age past 62. When you finally decide to claim, your monthly check will include every single COLA reported since you turned 62. A silver lining to inflation.

The 0% Capital Gains Opportunity

If your “taxable income” is below certain levels, you may be able to sell appreciated stocks, mutual funds or ETFs held for more than a year in your “non-retirement” accounts without paying federal capital gains tax.

Taxable income for your 2025 tax return is listed on line 15 of Form 1040. The standard deduction or your itemized deductions have already been subtracted from your gross income, along with any pre-tax deductible retirement plan or IRA contributions (if you have earned income) and, if you qualify, the new senior deduction.

For 2026, if you file a joint tax return and have taxable income projected to be at or below $98,900, you have a potential benefit. If you file single in 2026, the figure is $49,450. Keep in mind the standard deduction for a couple filing jointly in 2026 is $32,200, with an additional $1,650 per person if 65 or older. The standard deduction for a single filer is $16,100 this year, plus an additional $2,050 if 65 or older. In addition, for 2025 through 2028, those 65 and older may qualify for a new senior deduction of up to $6,000 per person ($12,000 for a married couple when both qualify). It begins to phase out above $75,000 of modified adjusted gross income ($150,000 for joint filers).

One important detail: the gains themselves count as taxable income. Only the portion of your long-term gains that fits beneath the threshold is taxed at 0%; gains above it are generally taxed at 15%. Also, New Jersey taxes capital gains as regular income, so the 0% rate applies to your federal return only.

As this is an infrequent opportunity, there are occasions when even affluent investors can benefit. It could be the earlier years of retirement, prior to collecting Social Security and taking mandatory withdrawals (RMDs) from your retirement accounts. It could be a business owner with large capital expenses showing low income, or even a loss, for the year.

An Example: How Much Room Is There?

A married couple, both 66, are retired and delaying Social Security. In 2026, they expect $110,000 of pension and IRA income and have no other investment income. This is a hypothetical example.

Step 1: Subtract their deductions

Step 2: Find the room beneath the 0% threshold

The potential benefit: The couple could potentially realize up to about $36,400 of long-term gains and pay 0% federal capital gains tax on them. Taxed at 15% instead, the federal tax on those same gains would be about $5,460.

One last check: Their modified adjusted gross income would be about $146,400 ($110,000 + $36,400). That is still under the $150,000 level where the senior deduction begins to phase out, so the full deduction remains available.

Having a projection completed during the actual tax year in question can determine if this strategy makes sense. We typically identify this opportunity for a few clients each year.

At Retirement Refined, we believe everyone should be doing a tax projection during the course of each year. This is a great way to identify potential opportunities, including how to potentially reduce Medicare Income-Related Monthly Adjustment Amount (IRMAA) costs.

Sources: SSA 2027 COLA announcement; SSA 2027 COLA Fact Sheet; IRS Rev. Proc. 2025-32; IRS 2026 filing season resources for seniors; IRS Form 1040 (2025); BLS CPI, September 2026; BLS PPI, September 2026

As always, thank you for taking a few minutes each week to read our Retirement Report. I sincerely appreciate your continued confidence and the opportunity to be part of your retirement journey. Until next week, stay informed and enjoy the journey to and during retirement.

Please feel free to share the Weekly Retirement Report with family, friends and colleagues.

Thank you for reading!

Paul Levin, CFP®, ChFC®, RICP®¹, TPCP®
Founder and Principal

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The opinions voiced in this material are for general information only and are not intended to provide specific advice or recommendations for any individual. All performance referenced is historical and is no guarantee of future results. All indices are unmanaged and may not be invested into directly.

Market data sourced from The Wall Street Journal, LPL Research and Bloomberg as of October 16, 2026; 10-Year Treasury yield from the U.S. Department of the Treasury; WTI crude settlement from NYMEX.

Specific individualized tax advice not provided. We suggest that you discuss your specific tax issues with a qualified tax advisor.

There is no guarantee that a diversified portfolio will enhance overall returns or outperform a non-diversified portfolio. Diversification does not protect against market risk. Asset allocation programs do not assure a profit or protect against loss in declining markets. No program can guarantee that any objective or goal will be achieved.

Securities and advisory services offered through LPL Financial, Member FINRA/SIPC and a Registered Investment Advisor.

1. RICP® conferred by The American College. ↩︎