Paid Subscriber – Market is mixed – Risk Off remains at extreme levels – Update 10/26/26

Rising Treasury Yields and U.S. Debt: What Investors Should Know – Howard Marks

---

• Quant Alpha’s II – Up over 45% since June 2025

• Quant 30 – Up over 53% since June 2025

• Legacy – Up over 260% since April 2023

• Changes to the Quant Portfolios

• Education – Rising Treasury Yields and U.S. Debt: What Investors Should Know – Howard Marks

• Quick Links

---

---

USA Stock market week ending 10/23/26

• S&P 500 (SPY): Declined 0.4% for the week.

• Nasdaq Composite (^IXIC): Fell 0.7%, posting the largest decline among the major stock indexes listed.

• Dow Jones Industrial Average (DIA): Gained 0.4%.

• Russell 2000 (IWM): Rose 2.0%, leading the group as small-cap stocks outperformed.

• S&P 500 Momentum ETF (SPMO): Dropped 1.6%, underperforming the broader market.

---

Market Drivers this Week (10/26/26 – 10/30/26)

• Monday, October 26 — The Dallas Fed manufacturing survey is due at 10:30 AM ET, and Treasury will auction $69 billion in 2-year notes.

• Tuesday, October 27 — Consumer Confidence and FOMC Meeting: The Fed begins its two-day meeting. September durable goods orders, new-home sales, and October consumer confidence are scheduled for release. Treasury will also auction $70 billion in 5-year notes.

• Wednesday, October 28 — Fed Decision and Big Tech Earnings: The Fed announces its rate decision at 2:00 PM ET, followed by a press conference at 2:30 PM. Markets are pricing in roughly a 90% chance of no change to the 3.75%–4.00% target range, while expectations point to a possible December hike. Microsoft and Alphabet are scheduled to report earnings after the close, putting AI spending and cloud growth in focus.

• Thursday, October 29 — GDP, Inflation and ECB Decision: Third-quarter advance GDP, September PCE inflation, and weekly jobless claims are all scheduled for 8:30 AM ET. Amazon is scheduled to report after the close.

• Friday, October 30 — Labor Costs and Month-End Positioning: The third-quarter Employment Cost Index is due at 8:30 AM ET.

---

The CNN Fear & Greed Index

The CNN Fear & Greed Index remained firmly in Extreme Fear, rising slightly from 18 on October 16 to 21 on October 23. Despite this modest improvement, investor sentiment remains deeply pessimistic. The index has fallen 34 points from 55 on August 21, when sentiment was in Neutral territory. After briefly returning to Neutral at 45 on October 9, the index moved back into Fear and then Extreme Fear. Persistent pessimism may create opportunities for patient, disciplined investors, but extreme fear alone is not a reliable signal that the market has reached a bottom.

• 10/23/26 – 21 Extreme Fear

• 10/16/26 – 18 Extreme Fear

• 10/9/26 – 45 Neutral

• 10/2/26 – 31 Fear

• 9/25/26 – 37 Fear

• 9/18/26 – 29 Fear

• 9/11/26 – 33 Fear

• 9/4/26 – 42 Fear

• 8/28/26 – 54 Neutral

• 8/21/26 – 55 Neutral

---

The Quant Model Portfolios had another down week with Risk Off firmly remaining in control in the stock market. With the USA mid-term elections fast approaching and the possibility of a renewed conflict in the middle east very real, it is wise to be cautious in the market. Look for attractive lower prices for your favorite stocks over the next few weeks.