Tuesday, October 27, 2026 · Issue No. 4 · 2 min readDownload PDF
Fed meeting starts as December hike odds climb
The Fed's two-day meeting starts today, with futures pricing a ~91% chance of a hold tomorrow but a 73% chance of a hike in December (up from 42% a month ago). That would mean higher funding costs for card lenders. In cards, Citi is refreshing its American Airlines co-brand with a $150 fee, and New Jersey has introduced a BNPL licensing bill. Visa reports after today's close.
Market open Stocks opened modestly higher as the Fed's two-day meeting began: the S&P 500 was up 0.1% and the Nasdaq up 0.3% shortly after the bell, led by chips (SOXX +1.6%), while the VIX eased to 18.1. The 10-yr Treasury yield was steady at 5.00% and the 2-yr was 4.74%. Card and BNPL names were mixed: Affirm (+2.2%) and Citi (+1.6%) gained, while Klarna (-1.2%) and Amex (-0.4%) slipped.
Markets · 8:09 AM MT, Oct 27
- SPY+0.12%
- QQQ+0.35%
- VIX-1.79%
- 10-yr+1.1 bp
- Capital One+0.29%
- Synchrony+0.05%
- Affirm+2.19%
- Block-0.23%
4.74%
2-yr Treasury
+2.4 bp pre-open
~91%
Fed hold odds
decision Wed 2pm ET
73%
Dec. hike odds
vs 42% a month ago
$21.3B
Holiday BNPL (Adobe)
Nov-Dec online, +6.6%
Co-brand / private label
Citi / American Airlines
Citi is refreshing the Citi / AAdvantage Platinum Select and Business cards, effective Jan 24, 2027. The annual fee rises from $99 to $150, with the $0 first-year fee kept. New earn: 3x on AAdvantage Hotels & Cars, plus 2x on streaming and rides/rail for Platinum Select, or a chosen business category for the Business card. Both get up to $100/yr in inflight credits (replacing the 25% discount) and a Global Entry/TSA PreCheck credit. Platinum Select also adds Walmart+, and both add new travel protections. It's another mid-tier co-brand moving to a higher fee with more credits, the same pattern as the premium tier.
BNPL & installments
Klarna
Monness, Crespi, Hardt started coverage at Buy, with a $20 target (stock ~$12.81) on Oct 26. The firm sees margin conversion rising from ~18% in FY26 to 31% in FY28, and FY27/28 adjusted operating income 6-8.5% above consensus. It calls KLAR cheap at a PEG of 0.14 vs Affirm's 0.52.
Affirm holiday push
In an Oct 26 commentary, Affirm cited Adobe's forecast of $21.3B in US online BNPL spend for Nov-Dec (+6.6% YoY). It put 30+ day delinquencies at 2.7% of monthly installment balances, and said 96% of transactions come from repeat users. It is positioning Pay in 4 (0% APR) directly against holiday card balances.
New Jersey bill
Assemblyman Onyema introduced A5664 (Oct 26). It would require a state license for BNPL lenders, cap fees and interest rates, and require clearer disclosures, responsible-lending standards and dispute procedures. It's another state moving toward New York-style BNPL regulation, a day after our deep dive on the EU's CCD2.
Banking
Fed meeting begins
The FOMC meets today and tomorrow, with the decision at 2pm ET Wednesday. Markets price a ~91% chance of a hold at 3.75-4.00%, but a 73% chance of a December hike, up from 42% a month ago. The 2-yr is 4.74% and the 10-yr ~5.00% before the open. Higher-for-longer keeps deposit and ABS costs elevated for card and installment lenders.
Bank M&A
HomeTrust Bancshares agreed on Oct 26 to acquire Virginia's Blue Ridge Bankshares for about $448M. That adds to a busy October for community-bank deals, with regulators speeding up merger reviews.
Regional Q3 results
Q3 results kept coming on Oct 26 from C&F Financial, Five Star Bancorp and Capital Bancorp (CBNK). CBNK, which runs a credit-card business through OpenSky, reported strong revenue growth and positive operating leverage.
Week ahead
Tue Oct 27
Visa fiscal Q4 results after the close. They're the first read on US card spend heading into the holidays.
Wed Oct 28
The Fed decision is at 2pm ET, with Chair commentary on the December path.
Thu Oct 29
Q3 GDP and September PCE (expected 3.7% YoY headline). Mastercard also reports this week.
Market recap as of 8:09 AM MT, Oct 27
| Rates & alternatives | Last | Day | 30d | 1y |
|---|---|---|---|---|
| 2-yr Treasury | 4.74% | +2.4 bp | -7 bp | +126 bp |
| 10-yr Treasury | 5.00% | +1.1 bp | -21 bp | +101 bp |
| TLT (20+ yr) | $81.54 | -0.17% | +3.7% | -11.2% |
| SGOV (T-bills) | $100.69 | +0.02% | +0.0% | +0.0% |
| Gold (GLD) | $370.06 | +0.61% | -2.6% | +2.3% |
| Bitcoin | $79,989 | +0.13% | -4.8% | -30.4% |
| Banks & card | Last | Day | 30d | 1y |
|---|---|---|---|---|
| JPMorgan (JPM) | $336.15 | +0.63% | -1.7% | +10.3% |
| Regional (KRE) | $72.52 | -0.29% | +1.5% | +18.6% |
| Synchrony (SYF) | $74.87 | +0.05% | +3.4% | -0.2% |
| BFH | $102.90 | +1.16% | +0.7% | +54.6% |
| Capital One | $202.93 | +0.29% | +1.8% | -9.1% |
| Amex (AXP) | $313.83 | -0.39% | +2.0% | -13.1% |
| Citi (C) | $122.99 | +1.61% | -8.0% | +21.8% |
| Affirm (AFRM) | $71.01 | +2.19% | +1.3% | -7.9% |
| Block (XYZ) | $74.38 | -0.23% | -1.2% | -7.2% |
| PayPal (PYPL) | $54.90 | -0.16% | +1.0% | -28.0% |
| Klarna (KLAR) | $12.47 | -1.19% | -1.2% | -68.6% |
| Equities | Last | Day | 30d | 1y |
|---|---|---|---|---|
| S&P 500 | 7,684.52 | +0.10% | -0.5% | +11.4% |
| SPY | $766.30 | +0.12% | -0.3% | +11.5% |
| Nasdaq Comp. | 26,245.19 | +0.29% | -2.6% | +10.4% |
| QQQ | $714.66 | +0.35% | -3.5% | +13.4% |
| Dow (DIA) | $522.56 | -0.08% | +1.6% | +9.1% |
| Russell 2000 (IWM) | $277.48 | +0.18% | -1.0% | +11.2% |
| Semis (SOXX) | $499.92 | +1.64% | -12.1% | +64.7% |
| VIX | 18.06 | -1.79% | +11.8% | +13.2% |
Intraday quotes from Interactive Brokers; indices and VIX delayed ~15 min (7:54 AM MT). 30-day and 1-year changes compare today's price with the weekly opening price nearest each date (Sep 28, 2026 and Oct 28, 2025); price only, excluding dividends. 10-yr from CBOE TNX. 2-yr from Kiplinger's live Fed blog (morning), compared with U.S. Treasury par-yield closes of Sep 25, 2026 (4.81%) and Oct 27, 2025 (3.48%). Bitcoin day change vs 24h.
Previous issueMon, Oct 26 · Europe's new BNPL rules land on Klarna and PayPalNext issueWed, Oct 28 · Visa and PayPal show card spending is holding up
Sources are linked in every issue. Confirm figures against the original filings before relying on them.