US Stock Market Weekly Summary: Week of October 19, 2026
This week was a week where “stocks were sold despite strong earnings.”
Market interest is shifting from revenue growth to “can the money invested in AI really be recovered?” Added to this were rising crude oil prices and interest rates.
■ This week’s figures (October 23)
・NY Dow: 52,215.16 (+0.4% weekly)
・S&P 500: 7,623.68 (-0.5%)
・Nasdaq: 25,955.34 (-0.7%)
・Russell 2000: 2,775.90 (+2.0%)
・US 10-Year Treasury: approx. 4.99% / 2-Year: approx. 4.69%
・USD/JPY: around 157 yen
・WTI: $103.27 / Brent: $116.72
・Gold: approx. $4,000 / Bitcoin: approx. $81,400
*Stock prices are closing prices on the 23rd; crude oil is the settlement price.
Gold, exchange rates, and Bitcoin are reference levels checked at different times.
The Nasdaq fell, while the Russell 2000 rose.
It appears that funds are gradually flowing out from the extreme concentration in large-cap tech.
■ Meta: Revenue is strong. But there is no cash left
・Revenue: $64.6 billion (+26%)
・GAAP EPS: $3.83
・Capital Expenditure: approx. $34.9 billion
・⚠️ FCF: -$2.12 billion
Since approximately $9.9 billion in litigation-related expenses are included, the decline in profit margins cannot be blamed entirely on AI.
However, the company also announced the creation of a new class of non-voting stock, and the stock price fell by about 7% on the 22nd.
AI growth and AI investment generating cash are separate issues. Points I have been concerned about for some time have become clearly apparent in these figures.
■ Tesla: Not growing, but protecting cash
・Revenue: $28.05 billion (almost flat year-on-year)
・GAAP EPS: $0.22 (-44%)
・Non-GAAP EPS: $0.48 (-4%)
・FCF: approx. $1.53 billion
Although growth is sluggish, they are keeping capital expenditures down and cash flow positive. It is the opposite approach to Meta.
■ Selling spreads to AI and semiconductors
On the 22nd, the Nasdaq was down 2.60% and the SOX index was down about 6.7%.
However, not all earnings are bad.
According to Reuters, as of the 22nd, about 83% of the 111 S&P 500 companies that have announced earnings have exceeded expectations.
They are not being sold because profits are weak. I see it as the hurdle for expectations having been raised.
■ US Economy: Businesses are healthy, households are exhausted
・University of Michigan Consumer Sentiment (October final): 48.0 (preliminary 46.3)
・1-year expected inflation rate: 4.7% / Long-term: 3.5%
・S&P Global Composite PMI preliminary: 57.6
・Initial jobless claims: 194,000
Business activity and employment are solid. Even so, households are suffering from high prices. This temperature difference is the current state of the US.
■ The Fed and crude oil: Two forces pulling interest rates
The policy interest rate is currently 3.75–4.00%.
While a hold is the prevailing expectation for the October 27–28 FOMC meeting, caution regarding additional rate hikes within the year remains.
Funds have fled to government bonds due to the stock market decline, pushing the 10-year Treasury yield below 5%. Meanwhile, Brent crude rose about 6% for the week.
The backdrop includes Houthi attacks on Saudi Arabia and supply concerns in the surrounding waters.
Stock declines lower interest rates, while high oil prices push them up.
This is a very difficult situation to judge.
High oil prices are a cost for aviation, logistics, chemicals, and retail, but a tailwind for energy companies. Who pays and who benefits? This has become clearly divided here as well.
■ Japanese Market
・Nikkei 225: 62,693.16 yen (weekly -4.03%)
・TOPIX: weekly -2.46%
・September National CPI: Headline +2.1% / Ex-fresh food +2.1% / Ex-fresh food & energy +2.4%
The significant decline in the Nikkei 225 is also related to the index structure, which has a high weighting of semiconductors.
■ Personal Summary
The success of a technology and the profitability for shareholders who invested in that technology are two different things.
I do not deny the growth of AI itself.
As I always say, I believe the following points will be scrutinized more and more strictly:
・Has AI investment actually increased profits?
・Is there cash remaining after capital expenditures?
・Can funding continue even with high interest rates?
For me, growth themes are strictly satellite holdings.
Beyond just finding good companies, I want to remember the basic principle of how much I am paying for those earnings right now.
I am holding a relatively large amount of cash.
■ Next Week’s Schedule and Critical Points
・10/27–28: FOMC (Policy rate announcement on the 28th)
・10/28: Microsoft, Alphabet earnings
・10/29: US Q3 GDP preliminary report, September PCE, Amazon earnings
・10/29–30: Bank of Japan meeting (Policy decision, Outlook Report, and Governor Ueda’s press conference on the 30th)
Critical Points
・Will the Fed signal additional rate hikes in December?
・Will the 10-year Treasury yield exceed 5% again?
・AI investment amounts, profit margins, and cash flow for MSFT, GOOGL, and AMZN
・Will the PCE confirm a re-acceleration of inflation?
・The persistence of high Brent crude prices and the USD/JPY exchange rate
Next week’s earnings from the three major tech companies will likely be a test of whether ‘expectations’ for AI are backed by ‘returns’.
Now, how much will the market pay for that answer?
Main Reference Materials
・Reuters: Global Markets on October 23
・AP News: Major US Indices
・Meta Official: Q3 Earnings
・Tesla: SEC Earnings Filing
・University of Michigan: Consumer Sentiment Survey
・Statistics Bureau of Japan: Japan CPI
・BEA: US Economic Indicator Release Schedule
This information is provided for general informational purposes regarding investment and does not recommend any specific product or transaction. Additionally, generative AI is used in parts of this article to assist with organizing information and drafting text. While I have verified the content as much as possible, I do not guarantee the accuracy or completeness of the information. Please make final investment decisions at your own responsibility, taking into account your own circumstances and risk tolerance.
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