The Nasdaq Composite fell 694 points, or 2.6%, on October 22, its largest daily percentage decline since June 5. Since the 2022 bear market bottom, the Dow has rallied 84% while the S&P 500 and Nasdaq have more than doubled, largely driven by AI infrastructure spending. The author notes that the S&P 500's CAPE ratio nearly reached 43 in early June, versus a 156-year average of 17.44, and that margin debt hit a record $1.502 trillion in June. He says the odds of a significant decline appear above average but are not guaranteed, and that since the Great Depression, average S&P 500 bear markets bottomed after 286 days while typical bull markets lasted 1,023 days. Corrections and bear markets are a normal part of the cycle, the author writes, and downturns have tended to resolve quickly.
Summary written by Upside AI from the original article. Read the source for full details.
Read the original on Yahoo Finance ↗
Keywords
Open a keyword to see other news on the same topic.
Related tickers and likely impact
QQQ
▼ Likely negativeInvesco QQQ Trust
Relevance: high
| Market | US stocks |
|---|---|
| Sector | ETF |
| Close on 10/23/2026 | 704.40 |
| Change that session | -0.01% |
SPY
▼ Likely negativeSPDR S&P 500 ETF
Relevance: medium
| Market | US stocks |
|---|---|
| Sector | ETF |
| Close on 10/23/2026 | 759.97 |
| Change that session | -0.52% |
Impact is scored by AI from the headline and may be wrong. It is not investment advice.
Related news
- The Puzzle Pieces for a Stock Market Crash Are Taking Shape, With 4 Historically Flawless Indicators Now Sounding the Alarm
Four years into the current bull market, which began after the 2022 bear market ended, the S&P 500 and Nasdaq Composite have more than doubled and the Dow Jones has risen 84%, driven by AI infrastructure spending and record share buybacks. The article argues valuations are historically stretched: the Shiller P/E topped 41 as of Oct. 21, the second-priciest level in history, versus a 156-year average of 17.44. Since January 1871, the CAPE Ratio has exceeded 30 during a continuous bull market only six times, and the previous five were followed by declines of 20% to 89% in one or more major indexes. Outstanding margin debt hit a record $1.502 trillion in June 2026, up 77% since April 2025; after the three earlier surges of this kind peaked, the S&P 500 fell 49%, 57% and 25%. The article also notes that investors have historically overestimated how fast next-big-thing technologies get adopted.
- Today Is a Powder Keg for Markets
Markets face a day of reckoning as megacap tech companies join the earnings season and the Fed announces its latest interest rate decision.
- This Could be the Most Crucial Week of the Year for Markets
- Nasdaq surges on Space X 3rd quarter revenue growth
SpaceX shares jumped on Wednesday, lifting the Nasdaq and the broader market after the company reported 161% revenue growth in the third quarter and ninefold growth in its AI business. Cresset's chief market strategist Joe Zidle said SpaceX is not an anomaly and that similar results may become more common across the sector. The S&P 500 rose 0.58% to 7,757.22, the Dow gained 0.69% to 52,857.10, and the Nasdaq Composite was the session's strongest performer, up 1.05% to 26,702.86. The U.S. dollar edged lower against most major currencies in quiet trading, with USD-CAD at 1.4046 and EUR-USD at 1.1234. Canada's S&P/TSX Composite rose 0.60% to 36,324.99, Germany's DAX gained 1.35%, and Hong Kong's Hang Seng fell 0.90%.
- Update: Tech-Led Rally Lifts Nasdaq, Extends S&P 500's Advance to Third Day
- Tech Stocks Power S & P 500 and NASDAQ Higher
Related markets
Latest news
- Amazon Just Lost $42 Billion in Free Cash Flow. Is It a Red Flag for Investors?
Amazon posted strong growth in the quarter, with revenue up 17% to $201.9 billion after adjusting for foreign exchange and the Prime Day shift, and operating income up 61% to $28.1 billion. Yet the stock fell 1.4% in the regular session and tumbled about 7% after hours, as investors are skeptical of its massive AI-related capital expenditure, planned at $220 billion this year. In the third quarter alone, Amazon reported a free cash flow loss of $33.4 billion while spending $77.3 billion on property and equipment, and it has burned $42 billion in free cash flow over the last four quarters. The article says this equals 5.4% of trailing revenue, comparable to past cycle peaks such as 4.8% in 2022. Amazon forecasts 40% AWS growth over the next two years, and the author argues the spending could pay off through AWS.
- Why Arm Holdings Stock Plummeted by Nearly 10% Today
Arm Holdings shares fell almost 10% in Friday's session amid a broad sell-off in semiconductor stocks. The trigger was Intel's third-quarter report: although revenue grew in double digits and its data center and AI unit gained substantially, its fourth-quarter guidance was unexpectedly weak, forecasting sequential declines in revenue, gross margin and non-GAAP earnings per share, well below analyst estimates. Many chip stocks fell heavily, with Intel's outlook seen as a warning sign for the sector. The author argues markets tend to overreact and that Arm faces risks from the current contraction in PC shipments and rising component costs, though its asset-light licensing model may leave it less exposed than Intel. The author says they are waiting for Arm's fiscal second-quarter 2027 results, scheduled for Wednesday, Nov. 4 after market close.
- Is Intel Stock a Buy After Its Post-Earnings Plunge?
Intel shares fell sharply after hours on Thursday, from a $92.07 regular-session close to about $71, following third-quarter results. Revenue rose 21% year over year to $16.5 billion and adjusted EPS of $0.52 beat guidance, but the fourth-quarter outlook of $15.0–16.0 billion in revenue and $0.25 in EPS was weaker. Data center and AI revenue jumped 78% to $7.3 billion, while PC-related revenue fell 5% to $8.1 billion. Intel expects PC segment revenue to drop over 20% next quarter as industry PC units shrink about 12% in 2026 and 10% in 2027, and an accident that shut its Fab 28 plant in Israel also weighs on results. The author judges it is not yet time to buy, given the stock trades near 33 times expected 2027 earnings and the diluted share count is expected to be about 20% above the third quarter of 2025.
- Elon Musk 'trolls' over Binance hack, CZ bluntly says: 'I deeply respect you, please stop'
Binance co-founder Changpeng Zhao (CZ) asked Elon Musk to stop 'trolling' the exchange after the SpaceX and Tesla CEO posted emoji that appeared to mock the cyberattack on Binance, which caused losses of 6.3 billion USD on October 29. CZ pointed out that Binance holds SpaceX shares worth over 1 billion USD, stemming from its 500 million USD investment in Musk's Twitter acquisition, though this is a tiny fraction of SpaceX's valuation of about 2,000 billion USD. The feud is not new: in November 2021, Musk called Binance's temporary suspension of Dogecoin withdrawals 'shady', and CZ responded by citing Tesla's recall of nearly 12,000 vehicles in the US.
- Jim Cramer says it's time to look beyond tech. Here are 4 consumer stocks he likes
CNBC's Jim Cramer said investors seeking to diversify away from the struggling AI trade should consider consumer staples stocks. In October the Nasdaq-100 fell almost 7% as money rotated into defensive sectors, while the consumer staples index rose 11.4%. Cramer highlighted four stocks: Kimberly-Clark (up nearly 11% in October, under 15 times earnings, 4.7% dividend yield, with a pending merger with Kenvue); Procter & Gamble (up 11%, seen as attractive after better-than-expected quarterly results, though he prefers Kimberly-Clark's lower valuation and higher yield); Constellation Brands (up 20%, about 11 times earnings, yield above 3%, showing signs of a turnaround); and Coca-Cola (up 9%, after a strong quarter driven by volume).
- Why Bright Horizons Family Solutions Stock Swooned on Friday
Bright Horizons Family Solutions (BFAM) stock fell almost 18% on Friday after the child care company cut its 2026 guidance. For the third quarter, revenue of nearly $841.5 million rose almost 5% year over year, and adjusted EPS of $1.80 beat the $1.76 analyst estimate, though revenue missed the roughly $842.7 million consensus. Full-year 2026 revenue is now expected at about $3.07 billion, down from almost $3.09 billion to just under $3.12 billion, and adjusted EPS guidance was lowered to $4.98–$5.03 from $5.05–$5.15. Management attributed the cuts to an ongoing UK regulatory safeguarding notice and a softening child care market in Australia, which prompted an internal review of strategic alternatives for that business. The article notes the stock looks cheap on valuation metrics but needs growth from its full-service centers and a resolution of the Australia situation to draw renewed investor interest.
Get the briefing on Telegram or Zalo
Join the Upside Telegram channel or Zalo group for the Vietnam stocks and gold briefing at 8:00 and 19:00 (Vietnam time) on trading days, plus a weekly wrap on Saturday morning.