1. A Rough Week for Tech, and Why We’re Staying Calm

1. A Rough Week for Tech, and Why We’re Staying Calm

The Nasdaq-100 fell nearly 5% during Friday trading, taking it down more than 10% from its high just earlier this month. That’s the third time this year that the index of 100 of the largest growth-tech stocks fell into a 10% correction zone, according to Bloomberg. Yet even counting Friday’s drop and all the ups and downs this year, the Nasdaq-100 has nearly doubled over the last three years.

We know days like Friday and weeks like this one can be tough on individual investors when selling seems both targeted and wide. And even more so for those of us who love investing in individual stocks rather than just owning passive index funds.

The average stock is more volatile than the average market. So, we Fools will feel those market kicks more acutely than our neighbors might. But that also means we get to reap the rewards of the individual stocks that go on to double, or triple, or even rise five or 10 times in value, with the right long-term mindset.

Declines are the price of admission to the stock market. The S&P 500 has historically fallen 10% about once a year, and TMF co-founder and CEO Tom Gardner said in his latest Quarterly Call that a 10% to 15% drop shouldn’t surprise anyone with valuations this high.

If You’re Feeling Spooked…

• Stay invested and keep investing. Buying in thirds lets the calendar decide when you buy so you don’t have to guess the bottom. As Tom put it, “emotional reactivity is the enemy of wealth creation.”
• Diversify. Own enough stocks that no single one can sink you. We now suggest owning at least 50 stocks, built up over time.
• Watch large positions. If an artificial intelligence (AI) winner has grown into a big share of your portfolio, pick your “sleep number.” That’s TMF co-founder David Gardner’s term for the largest percentage you’d let any one holding reach and still sleep soundly. Many investors settle around 10%. Trimming back to that level lets you keep a great company and simply own a little less of it.
• Consider cash. Team Hidden Gems suggests about 10%, and Tom puts the range at 5% to 15% depending on your temperament. When the S&P 500 falls 10% to 20%, he feeds that cash back in gradually so you can play offense in a downturn.

2. Look Past the Election Volatility

U.S. stock futures ticked higher in pre-market trading today after a rough October. S&P 500 futures rose 0.48%, and Nasdaq futures gained 0.88%. The tech-heavy Nasdaq Composite fell 5.3% last month, while the S&P 500 slipped 0.93%. The market now pivots to the real event on the calendar – Tuesday’s midterm elections. Friday’s October jobs report will act as a routine macro backdrop.

• The monthly labor reality: The economy added just 29,000 nonfarm jobs in September, a slow pace. October estimates project 55,000—a modest pace that leaves little room for error. A big payroll miss typically reinforces fears of a slowdown, while a hot reading keeps interest rate cuts off the table.
• What the midterms mean for your portfolio: The impact may be smaller than headlines suggest. Morgan Stanley (MS -2.41%) notes that the White House, not Congress, drives most of the policies investors care about, such as trade and regulation. Some sectors, such as banks and industrials, could face pressure if Democrats win both chambers, while consumer staples and clean energy could benefit. Investors shouldn’t trade the election. Stay diversified and stick with your long-term investing plan.

3. Apple, Shopify, and More Report, Each With Something to Prove

As macro volatility swirls, big corporate earnings take center stage this week. Here are some to watch, recommended across Fool services:

• Apple (AAPL -1.23%) reports after Monday’s market close. Management has warned over supply constraints. Shortages could limit the number of iPhones and Macs available for sale.
• Vertex Pharmaceuticals (VRTX +3.50%), recommended by Team Rule Breakers, also reports after today’s closing bell. We’ll watch how fast its newer medicines beyond cystic fibrosis are growing.
• Shopify (SHOP -5.63%), recommended by Team Hidden Gems and by Team Rule Breakers, reports before Tuesday’s open. It guided to third-quarter revenue growth in the low 30s. We’ll track the e-commerce company’s enterprise expansion, gross merchandise volume (GMV), and holiday guidance.
• Advanced Micro Devices (AMD -10.88%), a chipmaker challenging Nvidia, reports Tuesday after the close. Data-center guidance may matter more than the quarter itself.
• Sezzle (SEZL +0.74%) reports Wednesday. Credit quality matters as much as growth, heading into holiday shopping, for the buy-now-pay-later lender.
• Lumentum (LITE -8.57%), which makes lasers for AI data centers, reports Thursday amid reported takeover talks from chip designer Marvell (MRVL -10.05%). Nothing is signed, so management’s comments could outweigh the numbers.
• Cloudflare (NET -9.54%) reports after Thursday’s close. Watch whether AI-driven traffic is showing up in revenue growth for the internet security specialist.
• Moderna (MRNA -0.47%) reports before Friday’s open. It’s the company’s first report since the phase 3 melanoma data, so cash and launch preparations will be in focus.
• Berkshire Hathaway (BRKB +0.10%) reports Saturday morning, so investors get the weekend to digest results before markets reopen Monday. Its cash pile shows how willing management is to deploy capital at current prices.

4. Kiniksa Steals Our Heart

Team Hidden Gems

Team Hidden Gems sees Kiniksa Pharmaceuticals (KNSA -5.45%) reaching $154.01 within five years, about 70% above today’s price of roughly $90. Shares climbed to new highs last week after Kiniksa raised its 2026 sales forecast for Arcalyst, its heart drug, to more than $1 billion. We first recommended the company at about $13 in November 2021 and again near $8 the next year. The stock has now grown nearly sevenfold from our first rec, and we think Arcalyst has plenty more to give.

• Blockbuster in the making: Drugs that top $1 billion in yearly sales earn blockbuster status, and Arcalyst looks set to join that club this year. The weekly injection treats recurrent pericarditis, a painful swelling around the heart that flares up again and again. Even after Q3 2026 sales jumped 58%, only about 23% of eligible patients were on Arcalyst by quarter’s end.
• Next shot on goal: Kiniksa plans to start human trials of a longer-lasting version by the end of 2026, which could spare patients weekly shots and extend its franchise. The company funds that work with about $569 million in cash and no debt, and our scoring system rates its leaders an 88.

We plan to hold while Arcalyst wins over the rest of its market and Kiniksa builds its next act.

5. Today’s Question!

When the broader markets drop, do you buy, hold, trim, or just tune out the noise? What did you do last week – and why?

Discuss with friends and family, or become a member to hear what your fellow Fools are saying!