The Friday Wrap — October 9, 2026: a record S&P, and small caps lose the lead

The year's order changed hands

For most of 2026 the small caps were the quiet winner. Last Friday IWM was still up 14.36% for the year against SPY's 12.86%, even after a September in which it lost 5.46%. This week that ended. SPY rose 1.16% to 778.57 and IWM fell 0.92% to 278.94, its fifth straight red week, and the year-to-date order flipped. SPY now stands at +14.17% for 2026 and IWM at +13.32%. QQQ is still ahead of both at +22.29%.

The large-cap index did it at a record. The S&P 500 closed at an all-time high on Tuesday, per the AP's market tally, and SPY set a 60-day high of 781.62 in that session. October so far reads SPY +2.09%, QQQ +1.55% and IWM +0.38%, a gap of 1.71 points in seven sessions. The index you owned decided your week again.

The minutes, and a hike that got less likely

The policy news came on Wednesday. The minutes of the September 15-16 meeting, released at 2:00 ET, showed that all 19 participants supported the quarter-point hike to 3.75%-4.00%, per roic.ai's summary, and that most of them judged another increase "would likely be appropriate" by year end, in securities.io's account. The same coverage described a split on pace, with some officials worried about over-tightening. The vote itself was 12-0, so there was no dissent in either direction to read.

The minutes describe a committee that met before the September jobs report. Payrolls rose 29,000 in that report, unemployment rose to 4.2%, and the BLS cut July and August by about 60,000 combined. Coverage after the minutes put the futures-implied odds of an October hike near 20%, down from about 70% before the payrolls print. The next decision is October 28, and that meeting carries no new projections. So the committee's own record leans toward one more hike this year, and the futures market has mostly stopped expecting it this month. Both things are true at once, and the CPI print on Wednesday is the next data either side gets.

Crude: Brent up, WTI flat, Hormuz still the story

Energy split along the two benchmarks. Brent settled 4% higher on Thursday and was on course for a weekly gain, while WTI was headed for a slight weekly decline, per OilPrice.com, which had Brent near $102.83 and WTI near $90.33 early Friday. The same coverage reported tanker attacks in the Strait of Hormuz, with crude transiting the strait down 27% from a wartime high the week before, to at least 10.1 million barrels a day. A hurricane approaching the Gulf Coast was the other supply variable cited. The White House said it would not strike Iran before the November 3 midterms, citing talks with Tehran, according to the same report.

USO, our WTI proxy, rose 0.56% on the week and 1.74% for October. That sits between the two headlines. It is still 26.54% above its 200-day average and 6.49% above its 50-day. The supply premium that built over the summer has not come out of the price.

Earnings: the season's first two reads

PepsiCo reported before the open on Thursday. Net revenue rose 5.6% and organic revenue 3.1%, per the company's release, and reported EPS rose 17%. Core EPS, the number that strips out one-time items, rose 2%. That gap is the part worth reading twice: the headline earnings growth was mostly not from the operating business. The company also said it is finding more structural cost cuts to offset input inflation. The stock closed up 3.73% that session at 128.34 on the broker feed, gave back 1.82% on Friday to 126.01, and finished the week up 0.10%.

Delta reported Friday morning, and the quarter showed what $90 oil costs an airline. Adjusted EPS was $1.72 against an LSEG consensus of $1.75, per CNBC, its first miss in two years. Operating revenue rose 21% to $20.19 billion, but adjusted revenue of $17.59 billion was slightly short of the $17.67 billion expected. Investing.com put the quarter's extra fuel cost at $1.6 billion. Delta cut its full-year adjusted EPS guide to $5.10-$5.60, from $6.50-$7.50 in July. The stock closed Friday at 82.15 against 82.14 the day before, essentially unchanged on a guide cut of that size. It had already lost 2.31% across the four sessions leading in.

The week on the tape

SPY gained in three of five sessions. It rose 0.67% on Monday and another 0.55% on Tuesday to 779.09, touching the 781.62 high. Wednesday and Thursday gave back 0.66% between them, and Friday added 0.60% inside a 775.14 to 779.42 range, closing above its open. The close is 0.39% under the new high.

The structure underneath is intact and tight. Price sits above every daily average, with the 20-day at 767.98 and the 50-day at 767.57, both about 1.4% below. The spread between those two lines is now +0.05%, the third week it has narrowed, so they are close to touching. On the weekly chart SPY is 1.11% above its 10-week average, but weekly MACD is still slightly negative. Price has run ahead of momentum on that timeframe. The weekly stochastic at 94 says the week closed near the top of its recent range. The two-red-week analog is not in effect.

Where the three disagree

QQQ added only 0.23% on the week, to 751.27. It set a new 60-day high at 762.86 during the week and closed 1.52% under it. Friday's candle had a long lower tail and a small body inside Thursday's, closing below its open. Buyers defended the low of the day and did not carry it further. QQQ is 3.69% above its 50-day, and its 20/50 spread is +1.80% and widening, so the trend measures still favor it.

IWM went the other way again. On Thursday it printed a new 60-day low of 274.52, under last week's 275.45, then recovered 1.61% to Friday's close. It is below its 10-day, 20-day and 50-day averages, 4.27% under the 50-day, with a 20/50 spread of -3.20% that is still widening. It sits just 0.68% above its 200-day. That makes five red weeks in a row.

The bond market did not supply the explanation this time. Last week we noted that small caps and the long bond sold off together. This week TLT rose 0.65%, its first gain after two weeks of losing more than 2% each, and IWM fell anyway. The pairing we described last week did not hold.

Cross-asset

These are ETF proxies. USO is not WTI, UUP is not the dollar index, and VIXY holds VIX futures, not spot VIX.

UUP rose 0.45% on the week and sits 4.45% above its 200-day, firming again. GLD gained 1.17%, with 1.57% of that on Friday, after two losing weeks; it is still 7.48% under its 200-day. IEF rose 0.39%. VIXY fell 2.51% on the week and is 33.04% below its 200-day, so volatility futures sat at the low end through a record high and a set of hawkish minutes.

Open interest

Open interest only, from OCC data as of October 7, so it is not Friday's book. The October 9 expiry carried its largest call strike at 785 (124,697 contracts), with 780 next at 39,116. Its largest puts were 767 (70,342) and 745 (49,004). SPY closed between the 767 put and the 785 call. The next listed expiry, Monday's, is thin: 5,339 calls at 785 and 4,624 at 800, against 7,165 puts at 734 and 4,022 at 770.

Next week

From the research: Monday is Columbus Day, and the bond market is closed while stocks trade. JPMorgan is scheduled to report Tuesday, October 13 before the open, with Goldman Sachs and Wells Fargo listed as estimates for the same day. September CPI lands Wednesday, October 14 at 8:30 ET, and September retail sales and PPI follow Thursday, October 15 at 8:30 ET. The next FOMC decision is October 28. From our local earnings cache, which covers 13 semiconductor names only, ASML is scheduled for Wednesday and TSMC for Thursday. Our audited local econ list ended October 2. Dates move.

What we don't carry

No dark-pool prints, no closing-auction imbalance, no spot VIX and no true gamma exposure. The levels come from SIP bars and OCC open interest, and the macro from the outlets named below.

What this sets up

The through-line is a market that kept getting narrower while it set records. SPY made a new high, QQQ made a new high and stalled under it, and IWM made a new low and gave up its lead for the year. The committee's minutes lean toward one more hike by December, the futures market prices only a fifth of a chance for October, and Delta just showed what $90 crude does to a margin.

Next week puts data against each of those threads. Wednesday's CPI is the inflation read the minutes are waiting on. The bank reports on Tuesday are the first look at how credit and lending held up under a 3.75%-4.00% funds rate. Wednesday and Thursday's semiconductor prints from ASML and TSMC speak to the chip names that sit near the top of QQQ.

The levels are close on both sides. SPY is 0.39% under its 781.62 high, and its 20-day at 767.98 and 50-day at 767.57 sit together about 1.4% below. Friday's expiry rolled off with 767 and 785 as its largest strikes, and Monday's book is thin. QQQ is 1.52% under 762.86. IWM is 1.61% above its 274.52 low and 0.68% above its 200-day at 277.06. Which of these gives first is not ours to say. Where they sit is.

The Coil board

The account is in day mode as of Friday. The SPX book has names on in agile, chop-capped mode, with SPY and three of eleven sectors open (Energy, Health Care and Information Technology, up from two last week) and 172 names fully qualified. The QQQ book is also agile and chop-capped, moved from swing last week, with four of six sectors open (Biotech & Pharma, Internet & Media, Semis, Software) and 33 names qualified. Our macro read stays risk-off and defensive, standing down on longs. Crypto is constructive but cooler, with BTC 13.8% above its 200-day gate against 19.0% last week, one of two sleeves in, and 59 of 81 panel names above their own 200-day, down from 69.

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This letter is impersonal research produced by an automated system. It is not investment advice, it is not a recommendation, and it does not account for your circumstances.

Sources — prices, ranges, moving averages and weekly statistics from our own Alpaca SIP bars, split-adjusted; open interest from OCC data as of 2026-10-07; PepsiCo and Delta session closes from the broker feed. Macro and news from the Federal Reserve, the BLS, the AP via La Nación, roic.ai, securities.io, OilPrice.com, PepsiCo's earnings release, CNBC, Investing.com, and published BLS and Census release calendars.