Market Wrap, October 23, 2026

The S&P 500 slipped 0.5%, with a selloff in financials, consumer and staples names overwhelming a surge in energy as Middle East tensions and a bond-market scare over AI-related corporate debt dominated the session.

Crude oil drove the day's cross-asset moves. WTI settled at $103.27 a barrel, up 3.82%, and Brent settled at $116.72, up 3.14%, after a tanker was hit by an unknown projectile near Hormuz and Trump raised the prospect of the US taking Iranian oil outright. Iran said a blockade of its southern ports had cut its imports 25%, even as Fars reported Tehran had halted illicit tanker traffic through the strait. Trump said the US won't strike before the midterms and that talks are underway, but also said Washington may conduct another operation against Iran and had directed CENTCOM to draft a strike plan with no deadline. Washington separately authorized release of up to 400,000 barrels from the Strategic Petroleum Reserve to offset a Louisiana refinery disruption.

Credit markets added a separate source of unease. The cost of insuring top-rated US corporate debt climbed to its highest level since March, echoing a global widening in bond risk premiums that hit a multi-year high earlier in the week. The move was tied to concern over how much debt technology companies will need to fund AI buildouts, after Meta Platforms disclosed plans to raise hundreds of billions of dollars, pushing its total spending commitments to near $825 billion from roughly $700 billion in July.

Energy was the only sector to post a gain, with XLE up 2.6%, led by SLB (+7.1%, after agreeing to buy Kelvion for about $3.4 billion), Halliburton (+5.2%) and Diamondback Energy (+4.6%). Every other major sector fell. Consumer Staples was the weakest, down 1.9%, with Coca-Cola off 2.8% and Newell Brands down 6.6%. Financials dropped 1.3%, with American Express down 3.7% after beating estimates but announcing plans to cut 5% of its workforce, about 3,500 jobs, and Globe Life sliding 8.2%. Consumer Discretionary fell 1.6%, Industrials 1.3%, and Health Care 1.1%. Technology was the lone bright spot outside energy, up 0.5%, with semiconductor names firm after Thursday's rout. Real Estate was roughly flat, with Crown Castle up 9.1% and American Tower up 4.1% as falling yields favored rate-sensitive names. Company News Deckers Brands fell sharply despite beating profit estimates and raising full-year guidance, with Q2 EPS of $2.03 topping expectations and full-year sales guidance lifted to $5.70-$5.725 billion. Comfort Systems USA dropped despite strong Q3 results, with EPS of $13.91 beating estimates and the board raising its dividend to $1.00 per share. AT&T and T-Mobile US extended steep post-earnings declines, with telecom carriers broadly weak through the session. SLB agreed to acquire Kelvion for roughly $3.4 billion and reported Q3 EPS of $0.64, slightly ahead of expectations. American Express raised full-year EPS guidance to $18.30-$18.60 after beating Q3 estimates, but also announced plans to cut about 3,500 jobs, 5% of its workforce. LKQ withdrew its full-year guidance after a Q3 miss tied to European underperformance and announced a leadership change, naming Salvatore Abbate as CEO effective December 15. CRH completed its approximately $8.5 billion acquisition of Arcosa, which delisted from the NYSE. Bristol-Myers Squibb reported its IZA-BREN drug reduced the risk of progression or death by 59% versus chemotherapy in a Phase 3 breast cancer study, and separately signed data-licensing agreements worth up to $192.5 million with Tempus AI and Pathos AI. CrowdStrike and Palo Alto Networks rallied after CrowdStrike's CEO said the company expects a wave of breaches tied to a PHP vulnerability. SK Hynix confirmed it has scrapped plans for a US IPO of its Solidigm unit.