What moved markets the week ended October 30, 2026?
The largest technology companies reported strong growth this week, and investors focused on what it cost to achieve. Alphabet's revenue rose 25% and its cloud business more than doubled, but heavy spending on AI pushed its free cash flow negative and its shares fell about 13%. Amazon's cloud unit grew at its fastest pace in nearly five years, yet its stock also fell on spending concerns, and Intel dropped nearly 29% on Friday after a weak forecast. The S&P 500 lost 1.8% on Friday, its worst day since June, and finished the week down 0.6% for a third straight weekly decline, while small caps rose 1.3%. The Federal Reserve held rates steady over two dissents favoring a hike, third quarter GDP grew a stronger-than-expected 3.4%, and inflation rose to 3.6%. Treasury yields fell anyway as investors sought safety. Over the weekend, Iran proposed reopening the Strait of Hormuz within two days if the United States meets its conditions, and voters head to the polls on Tuesday.
Key numbers for the week ended October 30, 2026
- S&P 500: -0.6% for the week, +11.8% year to date
- Russell 2000 (small caps): +1.3% for the week, +14.4% year to date
- MSCI EAFE (developed international): +0.9% for the week, +9.5% year to date
- MSCI Emerging Markets: -0.7% for the week, +13.5% year to date
- Bloomberg US Aggregate (bonds): +0.6% for the week, -0.5% year to date
- Gold (SPDR Gold Shares): -3.0% for the week, -10.2% year to date
- Bitcoin: -4.3% for the week, -12.3% year to date
Total returns. Full tables under Market Performance below.
Big Tech Delivers Growth, Investors Question the Bill
This was the week the market had been waiting for, as the largest AI spenders reported results. The business news was strong. Alphabet's revenue grew 25% to $127.6 billion, its 13th straight quarter of double-digit growth, led by a 103% increase in Google Cloud revenue to $30.7 billion. Amazon Web Services grew 39% to $46.0 billion, its fastest growth in nearly five years. Microsoft reported continued strength in cloud demand.
The reaction turned on spending and cash flow. Alphabet's capital expenditures more than doubled from a year earlier to $51.4 billion, leaving free cash flow negative at $9.1 billion for a second straight quarter, and earnings of $2.12 per share fell short of the roughly $3.01 analysts expected, largely because of an $8.7 billion loss on its equity investments. Alphabet kept its 2026 spending plan of $195 billion to $205 billion and expects more in 2027. Its shares fell about 13% the following day. Amazon held to roughly $220 billion of 2026 capital spending, said it expects to spend meaningfully more in 2027, and reported trailing free cash flow of negative $42.4 billion; its earnings and revenue also came in slightly below estimates. Microsoft, by contrast, spent $45.2 billion but still generated about $19 billion of free cash flow, and its stock held steady. Intel fell nearly 29% on Friday, its worst day since 1974, after a profit forecast that missed expectations.
For the season as a whole, results remain strong. As of FactSet's October 23 update, with about a quarter of S&P 500 companies reported, 83% had beaten earnings estimates and blended earnings growth stood at 29.5%. The lesson of this week is that investors are now separating AI spenders that fund growth from their own cash flow from those relying on borrowing or new stock. Large-cap growth stocks fell 1.7% for the week and are now slightly negative for the year.
A Divided Fed Holds as Growth and Inflation Run Hot
The Federal Reserve held its benchmark rate at 3.75% to 4.00% on Wednesday, as expected, but the vote was 10 to 2, with Governor Lisa Cook and Cleveland Fed President Beth Hammack both dissenting in favor of a quarter-point hike. The statement said inflation remains elevated and upgraded its description of economic activity to expanding at a strong pace, while noting the committee is waiting for more information before acting again. Chair Warsh said financial conditions have tightened since September's increase and that the approaching election did not influence the decision.
Thursday's data supported both sides of the debate. The economy grew at a 3.4% annualized rate in the third quarter, faster than the roughly 3.1% expected and up from 2.2% in the second quarter, driven by consumer spending and AI-related business investment. But the Fed's preferred inflation gauge, the PCE price index, rose 0.5% in September, its largest monthly gain since March, lifting the annual rate to 3.6% from 3.4%. Core PCE, which excludes food and energy, held at 3.1%, in line with forecasts.
According to the CME FedWatch Tool, the probability of a rate hike at the December 9 meeting briefly reached about 84% after the decision before settling near 72% by Friday. Treasury yields fell regardless, as the selloff in technology stocks sent investors toward safer assets. The 10-year yield ended the week at 4.93%, down from 5.00%, its lowest level in seven weeks, and fell about 36 basis points over October, its first monthly decline in eight months. The 2-year yield fell to 4.59%.
A Two-Day Hormuz Plan, With Conditions Attached
The weekend brought a possible opening in the talks to end the war with Iran. On November 1, Iran's foreign minister said Tehran and Qatari mediators had developed a plan to reopen the Strait of Hormuz within two days if the United States meets Iran's conditions, a shorter timeline than the seven-day proposal Washington rejected in September. Under the revised sequence, the United States would take steps on the first day and shipping would resume on the second. Iran's conditions include lifting the naval blockade and oil sanctions. Iranian negotiators held a third straight day of talks with Qatari mediators on Sunday, although no direct U.S.-Iran talks are planned.
The signals from Washington were mixed. President Trump said negotiations were going well and that Iran wants a deal, but added that he is in no hurry and renewed warnings about Iran's nuclear facilities. Secretary of State Marco Rubio said the President has not decided whether to launch new strikes and that a diplomatic settlement remains possible. Tensions in the strait persisted, with Iran's Revolutionary Guard claiming that two more tankers struck mines on November 1. Separately, OPEC+ kept its December production targets unchanged.
Oil reflected the push and pull. Brent crude finished Friday near $113 a barrel, below the prior week's $116.72, and both Brent and West Texas Intermediate rose nearly 15% in October. Early Monday in Asia, Brent fell to about $112 on hopes for diplomacy. With the President having said he would not attack Iran before the election, the days after Tuesday's vote are a period of heightened uncertainty for energy markets.
Election Week: What History Says About the Outcome
Over the past three weeks we have looked at how markets have behaved before and after midterm elections. With the vote now days away, one question remains: does it matter who wins? The research offers a mixed answer. A Motley Fool analysis of data back to 1874 found that divided government has been followed by somewhat stronger 12-month returns after midterms than unified government, about 16% versus 12% on average. Morningstar research covering the past century, however, found the stock market has done better overall under unified government. Invesco's review concluded that markets have performed well under single-party control and every form of divided government.
Where the research agrees is on timing rather than outcome. Morningstar found that of the 25 midterm-year Novembers over the past 100 years, only four saw stock market losses, and the most recent was in 1994, when rising interest rates rather than the election drove the decline. The common explanation, as we have noted in recent weeks, is that the resolution of uncertainty matters more to markets than which party prevails.
This year enters Election Day with conditions that history cannot fully account for: an active conflict affecting energy supplies, a Fed weighing another rate hike, and a market working through a reassessment of AI spending. Election results may bring short-term volatility, but the evidence across many decades is that long-term returns have depended far more on earnings, interest rates, and valuations than on the composition of Congress.
Small Caps and Value Lead Again as Growth Turns Negative for the Year
The rotation that has defined the past month continued. Small caps rose 1.3%, led by small-cap growth at 1.9%, and mid-cap value gained 1.0%. Large-cap value rose 0.5%, while large-cap growth fell 1.7% and is now down 0.2% for the year, compared with a 24.5% gain for large-cap value. The S&P 500 declined 0.6%. Developed international markets rose 0.9% and emerging markets fell 0.7%. Bonds gained as yields fell, with long-term Treasuries up 0.7%, the Aggregate up 0.6%, and municipal bonds up 0.7%. Real estate rose 1.4%. Gold fell 3.0% and is down 10.2% for the year, and Bitcoin fell 4.3%.
| Index | Last Week | YTD 2026 |
|---|---|---|
| Bloomberg US Treasury Bills 1-3 Month | +0.1% | +3.1% |
| Bloomberg US Government/Credit 1-3 Year | +0.3% | +1.5% |
| Bloomberg US Aggregate | +0.6% | -0.5% |
| Bloomberg Municipal 1-15 Year | +0.7% | -0.2% |
| Bloomberg Municipal Bond High Yield | +0.3% | +1.8% |
| Bloomberg US TIPS (Series-L) | +0.5% | +0.4% |
| Bloomberg Global Aggregate | +0.3% | -1.3% |
| Bloomberg US Corporate High Yield | +0.5% | +0.4% |
| ICE US Treasury 20+ Year Index Total Return | +0.7% | -2.8% |
| S&P/TSX North American Preferred Stock Index | -1.1% | +1.4% |
| Bitcoin | -4.3% | -12.3% |
| Invesco DB US Dollar Index Bullish Fund | +0.1% | +7.3% |
| SPDR Gold Shares | -3.0% | -10.2% |
| Index | Last Week | YTD 2026 |
|---|---|---|
| MSCI ACWI IMI Net Total Return | -0.2% | +11.2% |
| MSCI ACWI Net Total Return | -0.3% | +11.2% |
| Russell 3000 Total Return | -0.5% | +11.7% |
| S&P 500 Total Return | -0.6% | +11.8% |
| Russell 1000 Value Total Return | +0.5% | +24.5% |
| Russell 1000 Growth Total Return | -1.7% | -0.2% |
| Russell Midcap Total Return | +0.5% | +15.4% |
| Russell Midcap Value Total Return | +1.0% | +22.0% |
| Russell Midcap Growth Total Return | -0.8% | -3.4% |
| Russell 2000 Total Return | +1.3% | +14.4% |
| Russell 2000 Value Total Return | +0.7% | +19.9% |
| Russell 2000 Growth Total Return | +1.9% | +9.3% |
| MSCI EAFE Net Total Return | +0.9% | +9.5% |
| MSCI Emerging Markets Net Total Return | -0.7% | +13.5% |
| S&P 1500 Real Estate (Sector) Total Return | +1.4% | +10.5% |
Bitcoin weekly return from Bloomberg closing levels of $77,838.81 on October 30, 2026 and $81,328.21 on October 23, 2026. Bitcoin year-to-date return calculated by Vistamark from the October 30, 2026 close and the January 1, 2026 reference price of $88,722. All other figures are total returns through the October 30, 2026 close, sourced from Vistamark Bloomberg internal data systems.
The Election, the Jobs Report, and Iran
The coming week combines the midterm elections, the October employment report, and a pivotal stretch in the Iran talks, with the next consumer inflation report following on November 12.
What does this week mean for long-term investors?
The largest technology companies showed this week that AI is driving real growth, with cloud revenue rising at rates few would have predicted a year ago. The market's reaction showed that growth alone is no longer enough. Investors are rewarding companies that can fund the buildout from their own cash flow and marking down those that are borrowing or issuing stock to keep pace. That shift, together with a resilient economy, inflation still running well above the Fed's target, and a Fed still leaning toward another hike, explains why large-cap growth stocks are now slightly negative for the year while value and small-cap stocks have advanced.
Tuesday's election and Friday's jobs report will add to the volatility, and the period after the vote carries added uncertainty in the Middle East. History offers useful perspective: markets have generally looked past election outcomes, and the weeks after midterms have tended to be constructive. The more durable lesson from this year is how quickly leadership can change. A portfolio balanced across styles, sizes, sectors, and asset classes is built to participate in growth without depending on any single theme to deliver it.
- FactSet Earnings Insight
- CME Group FedWatch Tool
- Federal Reserve: FOMC meeting calendars and statements
- U.S. Bureau of Economic Analysis: Gross Domestic Product
- U.S. Bureau of Economic Analysis: PCE Price Index
- U.S. Bureau of Labor Statistics: Current Employment Statistics
- Institute for Supply Management: ISM Report On Business
- U.S. Department of the Treasury: Quarterly Refunding
- OPEC
Index returns are from Vistamark Bloomberg internal data systems.
Steady Through Election Week
Election weeks tend to bring headlines that tempt investors to react. VistaBuilder™ constructs allocations designed to hold up across political and market environments rather than depend on any single outcome, and VistaBalancer™ keeps those allocations on target as leadership rotates. If this year's shifts have left your portfolio more concentrated than you intended, we would welcome a conversation.
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The VistaWealth Office™ is the private wealth practice of Vistamark, an independent, employee- and partner-owned firm based in Chicago and Hinsdale: investment management, family office services and planning for families, business owners and executives, coordinated with each family’s tax and estate advisors.
Founder and CIO of Vistamark; as CIO of Fiducient Advisors, oversaw investment strategy for more than $260 billion in client assets. More about Matthew →
This article is for informational and educational purposes only and does not constitute investment, legal, tax or accounting advice, or an offer or solicitation to buy or sell any security. Views are those of the author as of the publication date and are subject to change. Vistamark Investments is an SEC-registered investment adviser; see our disclosures.
