After the close

Wednesday October 21

The hardware layers moved the way Sunday's risk 'A short squeeze lifts hardware' describes: on Wednesday Networking & Optics gained +2.4%, Memory & Storage +2.2% and Semiconductors & Equipment +2.0% against the equal-weight S&P 500, while the S&P 500 rose +0.5%.Three Risk-On triggers have crossed since Sunday: the market's structural state at −17, AI & Hyperscalers tactical momentum at +3 and Data Centers & Neoclouds structural at −59.A fourth, Compute's tactical state at −18, rests on one move, with MRVL and AMD closing above their 50-day averages.The Risk-Off calls on hardware trail since Sunday, Memory & Storage behind by 6.13 points.

Sunday's issue of October 18

Since Sunday

S&P 500+0.53% on Wednesday+1.29%
Triggers crossed4 Risk-On, 0 Risk-Off4 / 18Calls aheadTactical calls3 / 8Nearest open triggerAI & Hyperscalers, Risk-Off4 pts away

Sunday's watch list

Throughout US Treasury par yield curve The 10-year fell 15 bp to 5.09% in the week to 16 Oct; whether it holds decides if the rate-sensitive lifts in utilities and real estate extend.
Throughout Q3 earnings season continues Expected blended growth near 29.5% is the story behind a tape with structural breadth at −49.
Thu US weekly initial jobless claims A labour read ahead of the FOMC, with a market still weighing a hike after 3.7% CPI.
Fri CFTC Commitments of Traders Funds are net short 21.1% against a 17.2% mean; a cover would cut the +39 positioning support across every area.
Wed 28 Oct FOMC decision at the end of the 27-28 October meeting Warsh gave no signal; a hike would hit liquidity, already −32 tactical and −26 structural across the board.

Biggest moves

Sectors Technology led, +1.31% against the equal-weight S&P 500 · Communication Services lagged, −1.47%

S&P 500

503 names
NameWedSince Sun
Skydance SKYD · Communication Services+10.85%+13.89%
Super Micro Computer SMCI · Technology+9.55%+12.46%
Charles River Laboratories International CRL · Health Care+9.33%+14.90%
EchoStar ECHO · Communication Services+7.23%+8.52%
Bloom Energy BE · Industrials+7.13%+7.78%
AT&T T · Communication Services−6.45%−6.53%
DexCom DXCM · Health Care−6.39%−6.72%
NetFlix NFLX · Communication Services−5.31%−7.78%
Chipotle Mexican Grill CMG · Consumer Discretionary−5.16%−5.92%
Expedia Group EXPE · Consumer Discretionary−5.03%−1.15%

The chain

72 names
NameWedSince Sun
Super Micro Computer SMCI · Compute (accelerators)+9.55%+12.46%
Applied Digital APLD · Data Centers & Neoclouds+8.54%+16.23%
Bloom Energy BE · Power+7.13%+7.78%
MongoDB MDB · AI Software+6.71%+15.75%
Datadog DDOG · AI Software+6.50%+10.51%
SoundHound AI SOUN · AI Software−1.91%−2.33%
Applovin APP · AI Software−1.67%+0.67%
Alphabet GOOGL · AI & Hyperscalers−1.62%−1.71%
Oracle ORCL · AI & Hyperscalers−1.53%+0.70%
NuScale Power SMR · Power−1.43%−5.66%

Triggers

Sunday's conditions on Wednesday's closes
  • Risk-On Market S&P 500 structural ≥ −20 · Wed −17 Crossed
  • Risk-On AI AI & Hyperscalers tactical momentum quality ≥ 0 · Wed +2.8 Crossed
  • Risk-On AI Compute (accelerators) tactical ≥ −20 · Wed −18 Rests on MRVL rising above its 50-day (0.9% above at the close) and AMD rising above its 50-day (2.1% above at the close) Crossed
  • Risk-On AI Data Centers & Neoclouds structural ≥ −59 · Wed −59 Crossed
  • Risk-Off AI AI & Hyperscalers structural ≤ −21 · Wed −17 4 pts away closer
  • Risk-Off AI Semiconductors & Equipment structural ≤ −60 · Wed −54 6 pts away further
  • Risk-Off AI Data Centers & Neoclouds tactical ≤ −45 · Wed −38 7 pts away further
  • Risk-Off AI Power structural ≤ −50 · Wed −42 8 pts away further

The calls since Sunday

Tactical, against the equal-weight S&P 500

Ahead 3

  • Risk-OffIndustrials−0.86%
  • Risk-OffReal Estate−1.43%
  • Risk-OffPower−1.89%

Behind 5

  • Risk-OffData Centers & Neoclouds+3.24%
  • Risk-OffNetworking & Optics+1.96%
  • Risk-OffMemory & Storage+6.13%
  • Risk-OffSemiconductors & Equipment+1.77%
  • Risk-OffCompute (accelerators)+3.86%

No new calls are made during the week.

Next issue

Sunday, October 25

Market opens

Thursday, October 22 · 9:30 AM–4:00 PM New York time

Every area

Relative: each area against the equal-weight S&P 500; the S&P 500 against T-bills. Sunday's states as published.
WednesdaySince SundaySunday's states
AreaReturnRelativeReturnRelativeAbove 50-dayTacticalStructural
S&P 500 vs T-bills+0.53%+0.50%+1.29%+1.26%55% (+10 pp)−11 Balanced−27 Risk-Off
Technology +1.67%+1.31%+2.76%+1.57%55% (+19 pp)−18 Balanced−7 Balanced
Industrials +0.91%+0.54%+0.33%−0.86%49% (+20 pp)−30 Risk-Off−65 Strong Risk-Off
Financials +0.57%+0.21%+0.94%−0.25%45% (+5 pp)−17 Balanced−4 Balanced
Utilities +0.29%−0.07%−0.50%−1.69%68% (−3 pp)−7 Balanced−54 Risk-Off
Energy +0.28%−0.08%−0.12%−1.31%81% (+5 pp)+18 Balanced+9 Balanced
Materials +0.18%−0.19%+0.79%−0.41%67% (+21 pp)−6 Balanced−17 Balanced
Consumer Discretionary +0.03%−0.34%+2.73%+1.54%49% (+9 pp)−6 Balanced−46 Risk-Off
Health Care −0.49%−0.85%+1.26%+0.07%78% (+7 pp)+20 Balanced+37 Risk-On
Consumer Staples −0.73%−1.09%−0.58%−1.77%73% (+3 pp)+18 Balanced+19 Balanced
Real Estate −0.76%−1.12%−0.24%−1.43%21% (−3 pp)−28 Risk-Off−36 Risk-Off
Communication Services −1.11%−1.47%−1.22%−2.41%33% (+14 pp)−20 Balanced−40 Risk-Off
Compute (accelerators) AI+3.46%+3.10%+5.05%+3.86%2 of 6−25 Risk-Off−10 Balanced
Data Centers & Neoclouds AI+3.06%+2.70%+4.43%+3.24%0 of 10−39 Risk-Off−61 Strong Risk-Off
Networking & Optics AI+2.78%+2.42%+3.15%+1.96%0 of 10−37 Risk-Off−70 Strong Risk-Off
Memory & Storage AI+2.56%+2.20%+7.32%+6.13%1 of 7−36 Risk-Off−55 Risk-Off
Power AI+2.35%+1.99%−0.70%−1.89%2 of 11−28 Risk-Off−43 Risk-Off
Semiconductors & Equipment AI+2.34%+1.98%+2.96%+1.77%1 of 13−34 Risk-Off−58 Risk-Off
AI Software AI+2.29%+1.93%+6.09%+4.90%5 of 10−6 Balanced+12 Balanced
AI & Hyperscalers AI−0.52%−0.88%+0.60%−0.59%3 of 5−2 Balanced−16 Balanced

Liquidity and rates

  • Credit appetite +0.20% on Wednesday · +0.34% since Sunday high yield minus investment grade
  • Dollar +0.07% on Wednesday · 0.00% since Sunday
  • Long bonds +0.14% on Wednesday · +0.24% since Sunday
  • Treasury curve 10-year 5.13% (+1 bp) · 2-year 4.81% (+2 bp) · 3-month 4.25% (−1 bp) · 2s10s +32 bp par yields at the 2026-10-21 close; since Sunday +4 bp / +7 bp / −1 bp
  • Positioning CFTC Traders in Financial Futures, S&P 500 consolidated, report dated Tue, Oct 13 (published Fri, Oct 16): leveraged funds net short 21.1% of open interest, from net short 21.3% the week before. It stands in every state.
  • The crowd AAII Investor Sentiment Survey, week to Wed, Oct 14 (published Thu, Oct 15): 38.7% bullish, 19.7% neutral, 41.6% bearish — a bull–bear spread of −2.9 points, against AAII's long-run average of +6.0 (37.5% bullish, 31.5% bearish); +1.3 the week before. AAII · displayed, not scored

Sunday's risks against the tape

  • The Fed hikes on 28 October CPI at 3.7% [1] and a non-committal chair [2] leave a hike live, which would land on a liquidity component already negative everywhere. S&P 500 +1.26% since Sunday · Financials −0.25% since Sunday · Real Estate −1.43% since Sunday · Utilities −1.69% since Sunday
  • Capex financing tightens Hyperscaler liabilities above $4 trillion [9] and a 5.09% 10-year make the build-out sensitive to credit; a pullback in issuance would hit the hardware layers already at 30-week lows. AI & Hyperscalers −0.59% since Sunday · Data Centers & Neoclouds +3.24% since Sunday · Semiconductors & Equipment +1.77% since Sunday · Memory & Storage +6.13% since Sunday · Networking & Optics +1.96% since Sunday
  • Long yields reverse higher The rate-sensitive gains in the week to 16 Oct came with a 15 bp fall in the 10-year [14]; a reversal would undo them first. Utilities −1.69% since Sunday · Real Estate −1.43% since Sunday · Financials −0.25% since Sunday
  • A short squeeze lifts hardware Funds are net short 21.1% against a 17.2% mean, so a cover would hit the most oversold layers hardest and against the Risk-Off read. S&P 500 +1.26% since Sunday · Semiconductors & Equipment +1.77% since Sunday · Networking & Optics +1.96% since Sunday · Memory & Storage +6.13% since Sunday

Provisional states on Wednesday's closes

Provisional: next Sunday's states on Wednesday's closes beside Sunday's, both before any adjustment. Not published states and not a call; the triggers are read on these.
TacticalStructural
AreaSunWedChangeSunWedChange
S&P 500−11−1+10−27−17+10
Technology−18−11+7−7+3+10
Financials−17−7+10−4+1+5
Health Care+20+24+4+37+42+5
Consumer Discretionary−6+12+18−46−35+11
Consumer Staples+18+20+2+19+17−2
Energy+18+23+5+9+10+1
Industrials−30−23+7−65−61+4
Materials−6+4+10−17−15+2
Utilities−7−5+2−54−49+5
Real Estate−28−25+3−36−31+5
Communication Services−20−19+1−40−41−1
AI & Hyperscalers−2+5+7−16−17−1
Compute (accelerators)−25−18+7−10+1+11
Semiconductors & Equipment−34−340−58−54+4
Memory & Storage−36−34+2−55−49+6
Networking & Optics−37−370−70−67+3
Data Centers & Neoclouds−39−38+1−61−59+2
Power−28−30−2−43−42+1
AI Software−6+4+10+12+18+6

Session 3 since the issue of Sun, Oct 18; closes through Fri, Oct 16 are Sunday's · computed Sun, Nov 1, 5:31 AM · the sources are listed below

  • Prices Massive: split-adjusted daily closes through Wednesday, October 21, 503 S&P 500 constituents and every area's members
  • Treasury yields U.S. Treasury: daily par yield curve, Wed, Oct 21
  • Positioning CFTC: Traders in Financial Futures, S&P 500 consolidated, report dated Tue, Oct 13
  • The crowd AAII: Investor Sentiment Survey of Wed, Oct 14; displayed, not scored
  • Market hours NYSE: holidays and early closes, computed from the exchange's rules
  • The issue Sunday's issue of October 18: the states, the triggers and the watch list this page grades
  • Closes re-read AES's unchanged close, asked again of the provider and confirmed
  • The comment Drafted by a model from this document; every figure checked against it before it is shown.