Market overview

Market overview — October 26, 2026 (latest session)

Risk tone firmed into Monday's close after a rough prior week: the VIX fell to 18.30 points on October 26, down 1.15 points or 5.9 percent, as oil weakness and lower Treasury yields supported equities at the open. That bounce follows a sharp de-risking episode on October 21-23, when the tech-heavy Nasdaq Composite fell 2.6 percent, marking its steepest decline since June, while the broader S&P 500 slid 1.21 percent, driven by a sell-off that hit nearly all members of the "Magnificent 7"... after the Facebook parent company raised its projected capital spending for the year to a range of $135 billion to $145 billion — a reassessment of AI-capex payback that also hit chipmakers Intel and Advanced Micro Devices, both fell about 8 percent, while Broadcom slid 4.3 percent. The rebound into Monday was attributed partly to renewed AI enthusiasm: the long-awaited initial public offering (IPO) filing by artificial intelligence giant Anthropic helped lift tech, even as Meta shares slipped on disclosed plans to raise additional AI-infrastructure capital. Macro backdrop remains rate-decision driven: the Fed is widely expected to hold its benchmark range at 3.75% to 4% at Wednesday's October 28 FOMC meeting, with preliminary third-quarter growth forecast at a 3.2% annualised pace, up from 2.2% in the second quarter, keeping a December hike in play, and the 10-year Treasury yield hovering just under the psychologically important 5% level. This macro and earnings-driven volatility is consistent with the measured regime data: QQQ's 1-month underperformance versus SPY (-3.56%) lines up with the AI-capex-driven tech rout in the past week, while the simultaneous broadening of participation (RSP outperforming SPY by +3.71% over 1 month) and reduced speculative risk-taking (XBI underperforming by -2.16%) reflect investors rotating out of the most crowded, high-multiple AI/mega-cap names and into a wider set of stocks ahead of peak earnings season and Wednesday's Fed decision. Note that several of the index levels cited in news wires (e.g., S&P 500 near 7,677, Nasdaq Composite near 26,169) differ in scale from the SPY/QQQ data supplied here, since those are headline index points rather than the ETF closes being used for this analysis — the measured SPY/QQQ/DIA/RSP/XBI figures above should be treated as authoritative for levels and performance.