Podcast
Markets, Pullbacks & Opportunity
What Recent Volatility Means for Investors
October 24, 2026
What Recent Volatility Means for Investors
Markets struggled this week as the AI trade continued to unwind, with the Nasdaq falling 1.6% and the S&P 500 down 1.4%. European equities were particularly weak, dropping 3.5%, while emerging markets fell 2.4% and the TSX declined 0.9%. Beneath the surface, there was a notable rotation away from growth stocks, with the Russell 1000 Growth Index down 2.4%, while the Russell 2000 Value gained 0.8%. U.S. equal-weight stocks have also rebounded sharply relative to the cap-weighted S&P 500 in October, suggesting market leadership may be broadening as mega-cap technology stocks lose momentum. Meanwhile, the U.S. 10-year Treasury yield has pulled back nearly 40 basis points from its recent peak, providing some relief for rate-sensitive sectors.
Next week brings a busy calendar of central bank decisions, with the Federal Reserve, Bank of Canada, European Central Bank, and Bank of Japan all announcing policy decisions. Markets increasingly expect the Fed to hold rates steady, while a Bank of Canada hike is now widely anticipated.
Beyond central banks, investors will be watching U.S. third-quarter GDP and September inflation data for clues about the economy’s underlying strength. Growth is expected to reach 3.1%, while core PCE inflation is forecast to rise to 3.1%. The combination of resilient growth, sticky inflation, and elevated energy prices continues to challenge expectations for monetary easing. Meanwhile, mounting strains in France’s bond market add another layer of uncertainty, with French 10-year yields moving above U.S. yields for the first time since 2013. With markets reassessing the sustainability of AI investment and interest-rate expectations, next week could provide an important test of whether October’s rotation has further to run.
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