[10/23 US Stock Morning Weather] 10/22 (Thu) ☔ → 10/23 (Fri) ⛅? | Why money moved to banks and housing stocks on a day when tech was sold off
Today’s Summary
October 22 (Thu) was a day of selling, centered on tech stocks, triggered by earnings from Meta and Tesla. However, the Dow and small-cap stocks were mostly flat, suggesting a rotation of where money is going rather than a total market collapse. For October 23 (Fri), it should be sufficient to calmly watch whether the NASDAQ can hold its September lows.
1. 🌙 10/22 (Thu) US Market Weather | ☔ Rain
The average of the four major indices used to determine the weather (S&P 500, NASDAQ, FANG+, and Russell 2000) was -1.7%.
These are indicators showing market tension and investor sentiment (VIX is the closing price for 10/22 (Thu), Fear & Greed is the latest value).
VIX (Fear Index) 19.03. The previous business day was 16.68 (+14.09%).
Fear & Greed (Investor Sentiment) 20 (Extreme Fear). The previous business day was 31 (-11pt).
Featured News
(1) On 10/22, following earnings from Meta (which saw a significant drop) and Tesla, concerns over AI-related investment and financing costs resurfaced, causing tech stocks to plummet. The S&P 500 fell 1.2% and the Nasdaq Composite fell 2.6%, while the Dow Jones Industrial Average closed nearly flat. [Report]
https://finance.yahoo.com/markets/article/stock-market-today-thursday-october-22-dow-sp-500-nasdaq-tesla-meta-112217857.html
(2) Semiconductor and AI-related stocks were sold off after Lam Research warned of supply chain constraints. By late morning, chip and data storage companies, along with Meta, Microsoft, Amazon, and Alphabet, accounted for 93% of the market cap decline in the Nasdaq-100. Rising oil prices due to war concerns surrounding Iran also added pressure. [Report]
https://www.stocktitan.net/articles/why-is-nasdaq-down-today-october-22-2026-ai-chip-stocks
2. 🗺️ Sector Trends | Weather Map by Industry
Funds are shifting from semiconductors, internet-related stocks, and gold mining stocks to banks, regional banks, homebuilders, and transportation. Given that the Dow and small-cap stocks were flat, this is not a full-scale risk-off move. I interpret this as a movement to relocate money from AI growth stocks to domestic cyclical stocks.
Position of each industry (Relative to SPY 5-day/20-day)
🥇 Leading
Home Construction +6.19%/+3.74%, Regional Banks +4.82%/+2.49%, and 6 others
📈 Improving (Signs of fund inflows) Biotechnology +2.25%/-2.41%, Capital Markets (Securities) +2.22%/-0.38%, and 1 other
💤 Laggard
Aerospace & Defense -0.17%/-3.47%, Internet & Content Information -3.29%/-3.42%, and 3 others
The risk appetite indicators are XLY-XLP (20-day) -5.9% (leaning risk-off) / IWM-SPY (20-day) -1.35% (small-cap underperformance), which can be called a fund shift that is conscious of defense even within cyclical sectors.
Industries with Momentum (Momentum Score)
This is a score from 0 to 100 based on price momentum and trends (the higher the score, the better the industry’s flow).
It aggregates price movements over the past 3 to 12 months and is not suitable as a guide for short-term trading of a few days to a few weeks.
The top spots are occupied by oil and banks. While semiconductors are strong in the long term, their momentum has slowed recently.
3. 🌡️ Market Temperature | 20°C 🙂 Comfortable
I represent market overheating as “temperature” (calculated from indicators as of the 10/22 (Thu) close and the latest Fear & Greed value).
The guidelines are 🔥 35°C~ Very Overheated / 🌡️ 30-34°C Slightly Overheated / 🙂 20-29°C Comfortable / 🥶 10-19°C Cooling / ❄️ ~9°C Very Cold.
The breakdown is F&G 20 / RSI 45, 39 / 50-day moving average deviation -0.5% / 52-week position 89%.
4. 🌬️ Wind Direction | Slightly Headwind ↘️
I represent the external environment that easily moves stock prices as “wind” (values are the change on 10/22 (Thu)).
🌬️ Tailwinds: 10-year Treasury -19bp, rate cut pricing advanced (-21.5bp).
🌪️ Headwinds: Crude oil +2.01%, VIX +14.09%, risk appetite -5.9% (defensive is dominant).
Policy rate pricing (based on FF rate futures)
Changes since 10/21 (Wed) include a +10pt increase in the pricing of a “hold” at the 10/28 FOMC, and a -21.5bp decrease in pricing through the 9/15 FOMC.
5. 🧭 Market Cycle (Four Seasons) | 🌻 Summer: Earnings-Driven Market
Based on the relationship between interest rates and stock prices, we look at where the market is in its four phases. Currently, it is in an Interest Rate Rise × Stock Price Rise with an Earnings-Driven Market (Confidence 46%). This is a phase where economic and corporate earnings recovery drives stock prices; interest rates rise, but earnings grow even more. Cyclical sectors such as materials, industrials, energy, and consumer discretionary tend to take the lead.
Interest Rates: Rising (tightening direction) (10-year Treasury yield 3-month +27bp (rise), 10-year Treasury yield 1-month -16bp (decline), policy rate pricing +63.4bp (hike direction)).
Stock Prices: Uptrend (S&P 500 is above the 200-day moving average, the 200-day moving average is upward-sloping (+1.21% over 20 days), S&P 500 3-month return +3.39% (rise), NASDAQ is above the 200-day moving average).
However, materials, industrials, energy, and consumer discretionary, which tend to be the leaders in an earnings-driven market, are lagging with an average of -1.45% against SPY over 60 days. Capital flows have not yet caught up with this phase assessment, and the direction of interest rates is unclear, so it can be said that we are at the boundary with a liquidity-driven market.
The four phases cycle in the order of “Liquidity-Driven Market → Earnings-Driven Market → Reverse Liquidity-Driven Market → Reverse Earnings-Driven Market.” The next likely phase is Reverse Liquidity-Driven Market.
6. 🔭 10/23 (Fri) Forecast | ⛅ Cloudy
This forecast covers the US market starting on the night of 10/23 (Fri) Japan time.
On 10/22 (Thu), large-cap tech stocks were sold off across the board, while the Dow remained mostly flat. We will organize how to approach 10/23 (Fri), whether the selling will spread or settle down here.
AI assessment is “Wait and See” (5-point scale). This is a situation where you want to wait for more data rather than forcing a move.
The decline in the S&P 500 was on volume that was only 70% of the average, so it is not a capitulation sell-off. The F&G (Fear & Greed Index) is at 20, indicating extreme fear, and the index Put/Call ratio is also 1.02, suggesting strong defensive positioning, so the seeds for a contrarian play are emerging. The pricing for a hold at the 10/28 FOMC rose 10pt to 94.5% on 10/22 (Thu), but since the cause cannot yet be identified, we will treat October seasonality as a supplementary factor and maintain a neutral wait-and-see stance.
Outlook ahead We are currently in an earnings-driven market (a phase where earnings growth absorbs high interest rates), but if interest rates continue to fall, we may cross the boundary into a liquidity-driven market. For the time being, we are mainly watching for consolidation around the 9/16 lows, and if the S&P 500 breaks below the 9/16 low of 7551 on a closing basis, we will confirm a shift to the downside.
Focus for 10/23 (Fri) Recommended candidates are financials/banks and consumer discretionary/home construction, both of which continue to see capital inflows over the 5-day and 20-day periods. Risks include the 10-year Treasury yield exceeding 5% again and sudden interest rate volatility after the FOMC.
The point to watch on 10/23 (Fri) is “whether the NASDAQ can hold the 9/16 low of 25978.”
Upcoming Important Events
Events in the next few days from 10/23 (Fri) that are likely to move the market: ・10/27 September Durable Goods Orders, October Consumer Confidence Index, September New Home Sales (Earnings for Coca-Cola, Boeing, etc. also scheduled) ・10/28 FOMC Policy Rate Announcement (14:00 ET) and Chair Warsh Press Conference (14:30 ET) ・10/28 Microsoft, Alphabet Q3 Earnings (after close)
🗓 Seasonality Memo (Trends for the same month in the past) October: A month often remembered for sharp drops, but it is also the “graveyard of bear markets” where it is easy to bottom out and reverse. This does not apply every year.
※This information is provided based on automatically generated data. It is not a recommendation to buy or sell; please make your own final decisions.
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