Asset Management
10/19/2026 Market Strategy
October 19, 2026
Shake, Wobble, and Roll
Stocks Saw Some Volatility Across Sectors, Market Capitalizations, and Styles
Key Takeaways
- We’re updating our S&P 500 earnings estimate for 2026 to reflect even stronger profits growth than we expected back in Dec. Our new earnings estimate of $365 represents profit growth of 35.8% from a year earlier.
- Our price target for the S&P 500 by year end remains 8,100 (5.75% above Fridays closing level on the index). Our price target now implies a P/E ratio of 22.2 times our earnings estimate.
- The Q3 earnings season for the S&P 500 kicked off last week. Thus far, 21 financial firms reported 12.0% earnings growth while the broader index reported 47.3%.
- This week another 76 firms are slated to report, followed by 178 more over the week of Oct. 26.
- Last week’s inflation reports showed price pressures rising by more than expected. The core CPI (ex. food and energy) rose 0.3% in Sep. (0.2% was expected in Bloomberg’s survey). Producer prices also surged in the month.
- Last week’s data on retail sales surprised to the upside, but most of the revenue boost stemmed from higher sales at gasoline stations. Excluding those sources, sales were up 0.2% in September from the prior month.
Market participants will likely continue focus this week on Q3 earnings results as the earnings season moves ahead with another 76 S&P 500 companies reporting this week across all 11 sectors, including financials, technology, consumer discretionary, consumer staples, energy, materials, industrials, utilities, real estate, and health care.
Given the economic and corporate fundamentals experienced over the course of recent quarters stocks may well have further upside ahead before year-end
This week’s stateside economic calendar should also grab market participants’ attention providing data throughout the week that should help gain insights on the quality of manufacturing, services, housing, employment and consumer sentiment.
Market Wobbles Some
Last week saw markets wobble some as inflation figures came in higher than expected for both the CPI and PPI headline and core (ex food and energy), as well as the price of oil, which returned to triple digits per barrel.
From our perch on the Market Radar Screen it looked more like another detour on the proverbial “wall of worry” rather than the end of a journey for the bull market.
Last week’s market performance suggests that once again bears, skeptics and nervous investors took opportunities to use the aforementioned inflation numbers and oil prices as catalysts to take some profits from the latest bull run in stocks that took the S&P 500 and the Nasdaq Composite to their latest respective record highs on October 6—less than two weeks ago.
On the week the S&P 500, the Nasdaq Composite, the S&P 400 (mid-caps), the S&P 600 (small caps) and the Russell 2000 (small caps) respectively shed 1.9%, 1.5%, 1.2%, 3.0%, and 4.5%.
The Dow Jones Industrial Average managed to eke out a modest 0.7% gain on the week as some market participants likely rebalanced, diversified, and rotated a portion of their portfolios into some member stocks of the Dow 30—viewed by some as less risky than other names.
We should note that while posting negative performance last week the S&P 500, the Nasdaq Composite, the S&P 400 (mid-caps), the S&P 600 (small caps) and the Russell 2000 (small caps) as of last Friday’s close stood up on a year-to-date basis: 11.9%, 12.5%, 9.4%, 12.7% and 9.6% respectively—none too shabby considering the elevated geopolitical 2 risks, the price of oil and not-always-positive views on AI.
Q3 Earnings Season Surprises
So far, so good for Q3 earnings season. With only 45 or 9% of the firms in the S&P 500 index having reported, it’s too early to draw conclusions about third-quarter results, but it appears to be off to a good start with earnings 47.3% higher on the back of 13.8% revenue growth per Bloomberg data.
Prior to the start of the quarter, bottom-up estimates from FactSet put analysts’ expected earnings growth at 29.6% from a year earlier. (See our Earnings Scorecard on page 7 of this report.) If realized, it would mark the third straight quarter in which growth exceeded 25% from a year earlier.
Our expectations are that another better-than- expected quarter is in the offing. Given the economic and corporate fundamentals experienced over the course of recent quarters along with watershed innovation that has seen reports of increased adoption of AI by businesses and consumers, stocks may well have further upside ahead before year-end.
That said, it is our view that investors should expect that as in Q1 and Q2 earnings seasons, intermittent volatility can be expected as uncertainty, any disappointments and even better-than-expected earnings results are met by a “what have you done for me lately” and “buy the rumor, sell the news” reaction along the way.
We expect that companies reporting disappointing results will likely continue to be treated particularly harshly by traders and other short-term players just as we’ve seen in recent quarters.
Forward guidance by corporate managements on their earnings calls will likely carry considerable weight this season in an environment that remains transitionary when it comes to a broad range of factors that include price pressures on commodities, interest rates, monetary policy and other inputs such as wage growth, staffing plans, and those related to geopolitical developments.
An emphasis on quality and prudent diversification that avoids overly-concentrated portfolio positions when markets shift from risk on to risk-off and back again in reaction to news du jour triggering sell-offs can help maintain the courage of one’s convictions and keep goals and objectives in focus.
Name:
John Stoltzfus
Title:Chief Investment Strategist, Oppenheimer Asset Management Inc.
John is one of the most popular faces around Oppenheimer: our clients have come to rely on his market recaps for timely analysis and a confident viewpoint on the road forward. He frequently lends his expertise to CNBC, Bloomberg, Fox Business, and other notable networks.
DISCLOSURES
Strategist Certification - The author certifies that this investment strategy report accurately states his/her personal views about the subject securities, which are reflected in the substance of this investment report. The author certifies that no part of his/her compensation was, is, or will be directly or indirectly related to the specific recommendations or views contained in this investment strategy report.
The strategy provided in this report is provided by Oppenheimer Asset Management Inc., (“OAM”) a registered investment adviser affiliate of Oppenheimer & Co. Inc. (“OPCO”). It reflects analysis of fundamental, macroeconomic and quantitative data to provide investment analysis with respect to U.S. securities markets. The overview in this report is provided for informational purposes and does not constitute an offer to sell, a solicitation to buy, or a recommendation for any security or investment advisory services. The report is not intended to provide personal investment advice. The investments discussed in this report may not be suitable for all investors. Investors should use the analysis provided by this report as one input into formulating an investment opinion and should consult with their Financial Advisor. Additional inputs should include, but are not limited to, the review of other strategy reports generated by OAM, its affiliates, and looking at alternate analyses. Securities and other financial instruments that may be discussed in this report or recommended or sold by OPCO or OAM are not insured by the Federal Deposit Insurance Corporation and are not deposits or obligations of any insured depository institution. Investments involve numerous risks including market risk, counterparty default risk and liquidity risk. Securities and other financial investments at times may be difficult to value or sell. The value of financial instruments may fluctuate, and investors may lose their entire principal investment.
Strategist Certification - The author certifies that this strategy report accurately states his/her personal views about the subject matter reflected in the substance of this report. The author certifies that no part of his/her compensation was, is, or will be directly or indirectly related to the specific recommendations or views contained in this strategy report.
Potential Conflicts of Interest: Strategic analysts employed by OAM are compensated from revenues generated by the firm. The strategists authoring this piece also contribute to an OAM managed portfolio product that relies on and trades on the information contained herein. The managed portfolio strategy trades frequently, both ahead of and after the publication of this report. OAM generally prohibits any analyst and any member of his or her household from executing trades in the securities of a company that such analyst covers. Additionally, OAM generally prohibits any analyst from serving as an officer, director or advisory board member of a company that such analyst covers. In addition to 1% (or more) ownership positions in covered companies that are required to be specifically disclosed in this report, OPCO may have a long positon of less than 1% or a short position or deals as principal in the securities discussed herein, related securities or in options, futures or other derivative instruments based thereon and makes a market in the securities discussed herein. Recipients of this report are advised that any or all of the foregoing arrangements, as well as more specific disclosures set forth below, may at times give rise to potential conflicts of interest.
Third Party Research Disclosure OAM has a research sharing agreement with OPCO pursuant to which OPCO provides OAM Strategy thought pieces to its institutional and retail customers. OPCO does not guarantee that the information in OAM Strategy reports is accurate, complete or timely, nor does OPCO make any warranties with regard to the strategy product or the results obtained from its use. OPCO has no control over or input with respect to opinions found in OAM strategy pieces. OAM is a registered investment adviser affiliate of OPCO.
This report is issued and approved by Oppenheimer & Co. Inc., a member of all Principal Exchanges, and SIPC. This report is distributed by Oppenheimer & Co. Inc., for informational purposes only, to its institutional and retail investor clients. This report does not constitute an offer or solicitation to buy or sell any securities discussed herein in any jurisdiction where such offer or solicitation would be prohibited. The securities mentioned in this report may not be suitable for all types of investors. This report does not take into account the investment objectives, financial situation or specific needs of any particular client of Oppenheimer & Co. Inc. Recipients should consider this report as only a single factor in making an investment decision and should not rely solely on investment recommendations contained herein, if any, as a substitution for the exercise of independent judgment of the merits and risks of investments. The strategist writing this report is not a person or company with actual, implied or apparent authority to act on behalf of any issuer mentioned in the report. Before making an investment decision with respect to any security discussed in this report, the recipient should consider whether such investment is appropriate given the recipient's particular investment needs, objectives and financial circumstances. We recommend that investors independently evaluate particular investments and strategies, and encourage investors to seek the advice of a financial advisor. Oppenheimer & Co. Inc. will not treat non-client recipients as its clients solely by virtue of their receiving this report. Past performance is not a guarantee of future results, and no representation or warranty, express or implied, is made regarding future performance of any security mentioned in this report. The price of the securities mentioned in this report and the income they produce may fluctuate and/or be adversely affected by exchange rates, and investors may realize losses on investments in such securities, including the loss of investment principal.
Oppenheimer & Co. Inc. accepts no liability for any loss arising from the use of information contained in this report. All information, opinions and statistical data contained in this report were obtained or derived from public sources believed to be reliable, but Oppenheimer & Co. Inc. does not represent that any such information, opinion or statistical data is accurate or complete and they should not be relied upon as such. All estimates and opinions expressed herein constitute judgments as of the date of this report and are subject to change without notice. Nothing in this report constitutes legal, accounting or tax advice. Since the levels and bases of taxation can change, any reference in this report to the impact of taxation.
Investment Strategy should not be construed as offering tax advice on the tax consequences of investments. As with any investment having potential tax implications, clients should consult with their own independent tax adviser.
This report may provide addresses of, or contain hyperlinks to, Internet web sites. Oppenheimer & Co. Inc. has not reviewed the linked Internet web site of any third party and takes no responsibility for the contents thereof. Each such address or hyperlink is provided solely for the recipient's convenience and information, and the content of linked third party web sites is not in any way incorporated into this document. Recipients who choose to access such third-party web sites or follow such hyperlinks do so at their own risk. The S&P 500 Index is an unmanaged value-weighted index of 500 common stocks that is generally considered representative of the U.S. stock market. The S&P 500 index figures do not reflect any fees, expenses or taxes. This research is distributed in the UK and elsewhere throughout Europe, as third party research by Oppenheimer Europe Ltd, which is authorized and regulated by the Financial Conduct Authority (FCA). This research is for information purposes only and is not to be construed as a solicitation or an offer to purchase or sell investments or related financial instruments. This report is for distribution only to persons who are eligible counterparties or professional clients and is exempt from the general restrictions in section 21 of the Financial Services and Markets Act 2000 on the communication of invitations or inducements to engage in investment activity on the grounds that it is being distributed in the UK only to persons of a kind described in Article 19(5) (Investment Professionals) and 49(2) High Net Worth companies, unincorporated associations etc.) of the Financial Services and Markets Act 2000 (Financial Promotion) Order 2005 (as amended). It is not intended to be distributed or passed on, directly or indirectly, to any other class of persons. In particular, this material is not for distribution to, and should not be relied upon by, retail clients, as defined under the rules of the FCA. Neither the FCA’s protection rules nor compensation scheme may be applied. This report or any portion hereof may not be reprinted, sold, or redistributed without the written consent of Oppenheimer & Co. Inc. Copyright © Oppenheimer & Co. Inc. 2026.