Scott Rubner, head of equity and equity derivatives strategy at Citadel Securities, argues that the US midterm elections are serving as a clearing event for risk and that this could be when AI can outperform again. Institutional investors are delevering under rules tied to price or volatility levels, while retail investors bought semiconductors, neo clouds and memory stocks at the largest pace in 16 weeks. The momentum factor, up 70% year-to-date through the end of June, has turned negative, and AI winners versus AI laggards, which had gained over 100%, have also turned negative. With 38% of S&P 500 stocks down 20% from their highs, the index is only 150 bps below its peak, which Rubner describes as a rotation rather than a flush. Q3 earnings growth is expected at 27% year-on-year, while the S&P 500's 12-month forward P/E has fallen from 23 times to 18 times.
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midterm electionsartificial intelligenceCitadel SecuritiesS&P 500
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Related tickers and likely impact
QQQ
▲ Likely positiveInvesco QQQ Trust
Relevance: medium
| Market | US stocks |
|---|---|
| Sector | ETF |
| Close on 10/19/2026 | 718.36 |
| Change that session | +1.21% |
SPY
▲ Likely positiveSPDR S&P 500 ETF
Relevance: medium
| Market | US stocks |
|---|---|
| Sector | ETF |
| Close on 10/19/2026 | 766.48 |
| Change that session | +0.42% |
NVDA
▲ Likely positiveNvidia
Relevance: low
| Market | US stocks |
|---|---|
| Sector | Information Technology |
| Industry | Semiconductors |
| Market cap | $5.2T |
| Close on 10/19/2026 | 217.09 |
| Change that session | +1.38% |
Impact is scored by AI from the headline and may be wrong. It is not investment advice.
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