STRAIGHT FROM THE TRADING FLOOR
by Eric Criscuolo - Market Strategist
Published on 10/19/26 (a/o 2:00 pm)
DOW 51,993 (-10), S&P 500 7,699 (+40), Russell 2000 2,729 (+7), NYSE FANG+ 18,876 (+294), ICE Brent Crude $110.12/barrel (+$0.26), Gold $4,160/oz (-$21), Bitcoin ~81.8k (+247)
MAC Desk Commentary:
Tech came under significant pressure on Friday, culminating in various iterations of the “Tech Wreck” meme across financial media. There was softness throughout the week as financing concerns mounted and Chinese competitive threats hit memory stocks. Chip and memory stocks were down >10% while neoclouds were off >20%, closing back around the late-July Situational Awareness lows. After hitting a new all-time high the previous week, the S&P 500 fell nearly 2%, breaking below its 50d ma but not quite trading down to the 100d ma.

Looking past Tech, the vibes were better. 7 of 11 sectors ended the week higher, though Defensives were favored (Consumer Staples +5%). For a second consecutive week the equal-weight version of the index outperformed, up 0.5% and beating the market-cap weighted index by over 2%. Despite some hot economic data Treasury yields fell driven by a flight from AI to safety, and a related recalibration of growth assumptions should the white-hot AI spending slow. Oil prices rose on Friday and for the week as tensions increased in the Middle East and between Russia/Ukraine. Friday was also an options expiration, and the the VIX jumped from ~16 to >20 before pulling back to end the day. Throughout all of this, Q3 earnings season kicked off with the major financials names reporting resilient if not strong trends in consumer spending and credit performance, though stock reactions were mixed.

Today, on the 39th anniversary Black Monday, the S&P opened about 0.5% as Tech bounced and markets geared up for some big reports from Meta, SpaceX, IBM and SAP, among many others later this week. Speaking of SpaceX, Elon Musk pledged to give every kid in America a share of the company next year. A bullish Semi Analysis data center report and a couple of sell side upgrades (CRWV - GS, INTC - JPM) helped to fuel the bounce.

The S&P is around those opening levels currently, driven by that bounce in Tech and Mega Cap specifically (NYSE 100 +2%).  In a switch from last week, the equal-weight is underperforming and trading lower. Small caps are lagging as well but are flat to higher despite a backup in yields.  
The NYSE Semis index is up ~3% and DRAM ETF +4%. 4-5% gains for Amazon and Tesla have pushed Consumer Discretionary to the top of the leaderboard despite the rest of the sector mainly lower (travel/leisure higher). Morgan Stanley named AMZN a Top Pick, catalyzing the move higher.  Not everything is working for Tech. After its 2-week selloff, CoreWeave was bouncing in the pre-market but immediately headed lower as the regular session began. The stock is down ~3% currently. Microsoft (+1%) has pulled out of a UK data center deal with Nscale due to power delays according to reports- though they are still committed to the partnership. That has reminded markets of the recent postponement of the IPO for Australian data center operator Firmus. The rise in yields is pressuring Utilities and Real Estate, making them the laggards today. Financials are also lagging, with weakness across the sector.

In other corporate news, Cleveland Cliffs is trading up >15% after earnings, noting strong steel demand. In healthcare, Merck KGaA is buying Silence Therapeutics for $1.1B and Roche entered into a $15B biobucks ($400M upfront) ADC partnership with China-based Hansoh Pharma.
Treasury yields were around unchanged for most of the early morning but began to move higher as we approached the Open. They continued rising along with global yields, currently up ~6bp across the curve. That has coincided with the bounce in Tech. The US Dollar Index is up as well, stronger against European and Asian peers but weaker against commodity currencies (Canada, Brazil, Australia, etc). On a very light data calendar, homebuilder confidence fell to its lowest level since June 2012 according to the NAHB Index, and buyer traffic to April 2012.

  • US 2yr +6bps to 4.77%, 5yr +7bps to 4.95%, 10yr +6bps to 5.15%, 30yr +5bps to 5.48%
  • USD index: +$0.16 to $101.82
Civil unrest exploded in France over the weekend adding to fiscal concerns and pushing local yields higher. The major European indices were down ~1% though finished off their lows. Weakness was broad-based. Financials, miners and industrials led to the downside while Energy led.  On Friday, President Trump waived additional Russian sanctions that were to come into effect under a bill signed last month. That was followed by reports that Putin floated the idea of a summit with Trump, Xi Jingping and himself to find an end to the Russia-Ukraine war. Note that Zelensky was not included in Putin’s plans. After a drubbing last week markets in Asia opened lower but ended off the worst levels. South Korea bounced nearly 2% with broad based gains. The memory stocks were modestly higher. CXMT, which was the source of some of the recent memory weakness, sold off ~8% after its earnings update. Elsewhere in China, GDP, Industrial Production and Retail Sales all came in ahead of expectations. The Shanghai Composite recouped early losses to close modestly higher. Hong Kong was closed for holiday. The Nikkei ended modestly lower while India fell >1% giving back some of last week’s bounce.
Oil prices were lower with Dec Brent falling below $107, retracing more than half of Friday’s move higher, However it has since rallied into positive territory ~$110. There have been your standard divergent Middle East headlines, including one from Al Arabiya that said a breakthrough between the US and Iran was expected to be announced this week. Markets have taken it in stride.

US nat gas is lower while Dutch TTF pushes higher. Gold has weakened throughout the day as yields and the Dollar are higher. Other precious metals are flat to higher. A GS report said central bank demand should provide structural support for Gold, with China the largest identifiable buyer in August. Ag is mostly lower while crypto was bouncing modestly after moving lower over the weekend. Bitcoin is holding its 50d ma ~$81.5K. JPM announced it has added its JPM Coin to the Ethereum mainnet for institutional clients, after debuting on the Base network.
Tomorrow will be another light day for economic data, headlined by Housing Starts/Permits and Pending Home Sales. Earnings will include GE, MMM, MSCI, NOC, RTX and SYF before the open. 

Earnings:
  • After-Market: CCK, FNB, RLI, STLD, WRB, ZION
  • Pre-Market (Tues): ABB, ALLY, CBSH, EFX, GE, GM, GPC, HAL, HAS, KEY, MMM, MSCI, NOC, RTX, SYF, VICR, VMI, VZ
  • After-Market (Tues): ADC, ALK, CB, COF, EWBC, HWC, ISRG, LRN, NFLX, NLY, OZK, PEGA, UAL, WFRD

Economic Data:
US:
  • NAHB Housing Market Index: 29 vs 32 cons, prior 32
Global:
  • China GDP: 4.5% vs. 4.4% cons., prior 4.3%
  • China Industrial Production: 5.5% vs. 5.4% cons., prior 5.2%
  • China Retail Sales: 1.1% vs. 0.5% cons., prior 0.4%
  • China Fixed Asset Investment: -7.2% y.y vs. -7.3% cons., prior -7.2%
  • China Unemployment: 5.2% vs. 5.3% cons., prior 5.3%
  • China Home Prices: -2.8% prior -3%
  • Canada CPI: 0.1%/3.1%vs. 0.2%/3.2% cons., prior -0.1%/3%
STRAIGHT FROM THE TRADING FLOOR
by Michael P. Reinking, CFA - Sr. Market Strategist
Published on 10/19/26 (a/o 9:00 am)
Good morning,
 
Last week ended on a sour note with broad based losses on Friday. Throughout the week the main topic of conversation was the Tech Wreck as financing concerns hit the AI complex. Chip and memory stocks were down >10% while neoclouds were off >20%, closing back around the late July Situational Awareness lows. After hitting a new all-time high in the previous week, the S&P 500 fell nearly 2%, breaking below its 50d ma. For a second consecutive week the equal-weight version of the index outperformed managing to end the week up 0.5%, led by Energy, Consumer Staples and Healthcare. Despite some hot economic data Treasury yields fell driven by a flight to safety and as investors recalibrated growth assumptions should there be a slowdown in AI investment. Oil prices were on the move higher again as tensions increased in the Middle East and between Russia/Ukraine, despite Trump claiming an “energy ceasefire”. The downside momentum in equity markets picked up on Friday which was options expiration and as the VIX jumped from ~16 to >20.
 
Today is the 39th anniversary of Black Monday so after the ugly session on Friday it’s nice to see markets stabilize. S&P futures are trading up ~0.5% as there’s been a reprieve in the tech selling ahead of a big week of earnings which includes Meta, SpaceX, IBM and SAP. There is a bullish Semi Analysis data center report and a couple of sell side upgrades (CRWV - GS, INTC - JPM) helping to fuel the bounce (SMH +3%, DRAM +4.5%). Cleveland Cliffs is trading up >10% after earnings. Not all the news is positive though. Microsoft has pulled out of a UK data center deal with Nscale. The project had faced delays but is raising questions about the firm’s IPO. Staying on the other side of the pond civil unrest in France is adding to the fiscal concerns and pushing local yields higher. Oil prices are pulling back modestly after last week’s move higher despite tensions remaining elevated in both theaters. On Friday, President Trump waived additional Russian sanctions while there are reports that Putin is weighing a November summit with President’s Trump/Xi at APEC.  
 

 
The only economic data in the US is NAHB Housing index out after the open. Yields have started to move modestly higher over the last hour up 1-3bps across the curve.
  • US 2yr +4bps to 4.75%, 5yr +4bps to 4.91%, 10yr +3bps to 5.11%, 30yr +2bps to 5.45%
  • USD index: -$0.01 to $101.65
After a drubbing last week markets in Asia opened lower but ended off the worst levels. South Korea bounced nearly 2% with broad based gains. The memory stocks were modestly higher. CXMT, which was the source of some of the recent memory weakness, sold off ~8% after its earnings update. Elsewhere in China, GDP, Industrial Production and Retail Sales all came in ahead of expectations. The Shanghai Composite recouped early losses to close modestly higher. Hong Kong was closed for holiday. The Nikkei ended modestly lower while India fell >1% giving back some of last week’s bounce. Last week European indices outperformed but gapped lower overnight and have not been able to bounce. Yields in France are up 5-10bps across the curve and up 7-16bps in Italy. Major indices are down over 1% with broad based weakness. Financials are leading to the downside.
 

 
ICE Brent is down ~1.5% while WTI is only off 0.5% continuing to narrow that spread. Nat gas prices are modestly higher. Metals and ag are trading on either side of unchanged. Crypto is bouncing after moving lower over the weekend.
 

 
Economic Data:
US:
  • 10:00 NAHB Housing Market Index
Global:
  • China GDP: 4.5% vs. 4.4% cons., prior 4.3%
  • China Industrial Production: 5.5% vs. 5.4% cons., prior 5.2%
  • China Retail Sales: 1.1% vs. 0.5% cons., prior 0.4%
  • China Fixed Asset Investment: -7.2% y.y vs. -7.3% cons., prior -7.2%
  • China Unemployment: 5.2% vs. 5.3% cons., prior 5.3%
  • China Home Prices: -2.8% prior -3%
  • Canada CPI: 0.1%/3.1%vs. 0.2%/3.2% cons., prior -0.1%/3%

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