Big Tech Lags as the Wider Market Holds Up

In the week of 19 to 23 October 2026, the S&P 500 slipped 0.5% and the technology-heavy Nasdaq Composite fell 0.7%, while the Dow Jones Industrial Average gained just under 0.5%.

Smaller companies and value shares did better, as higher oil prices revived inflation concerns and investors continued to question the cost of funding the AI boom. In short, the wider market held up better than the largest technology companies.

With the UK Budget, a Federal Reserve decision and results from several of the world’s largest banks and technology companies all due before the US midterm elections on 3 November, the coming days deserve close attention.

Breadth of involvement, not direction

The more telling signal sat beneath the headline indices. While the largest technology names fell, smaller companies and value shares held up, and the average company outperformed the index giants over the week.

One week does not make a trend, and leadership can rotate back quickly. The point for advisers is a structural one: a cap-weighted index increasingly reflects the fortunes of a small number of companies, and a week like this shows what happens when those companies stumble.

Same pressures in Asia

Most major Asian indices fell over the week despite a partial rebound on Friday. Japan’s Nikkei 225 fell 4% and Hong Kong’s Hang Seng fell 4.5%, weighed down by concerns about technology valuations, energy prices and global growth.

Bargain buying helped Chinese, Hong Kong and South Korean shares recover some ground at the end of the week.

A crowded political and policy calendar

In the UK, the Budget on Wednesday 28 October is the main domestic event. Markets will focus on tax, spending and borrowing.

A package that requires more borrowing would add upward pressure on gilt yields, affect sterling and make the Bank of England’s task of reducing inflation harder.

The Federal Reserve’s two-day meeting concludes the same day, with a decision at 18:00 UK time.

Markets have all but discounted no change, but expect a rate rise in December. The European Central Bank, Bank of Japan and Bank of Canada also make decisions, though these are less likely to move global markets.

Politics adds a further layer. Forecasts give the Democrats an 87% probability of winning the House of Representatives at the US midterms on 3 November, while the Senate remains too close to call.

A Democratic House and Republican Senate would probably be the most market-friendly outcome, as gridlock reduces the risk of sudden policy change. In Brazil, President Lula narrowly won a fourth term, and investors will now look for a clear mandate and a credible plan for public spending and debt.

Earnings will set the short-term tone

HSBC reports third-quarter results on Tuesday 27 October and Lloyds Banking Group on Thursday 29 October, giving a read on both international banking and the UK domestic economy.

In the US, Alphabet, Microsoft and Amazon are the headline results, with AI spending, cloud growth and margins in focus. Across the wider results season, investors will want to know whether companies can still raise prices, whether costs are easing and whether investment plans are being maintained or cut back.

What this means for portfolio construction

A week like this is a reminder that headline index moves can hide very different outcomes underneath, and that several significant events can land within days of each other. Portfolios that depend on a narrow group of companies, or on one event going a particular way, carry more risk than they may appear to.

TEAM’s UCITS funds, across the Multi Asset Growth, Balanced and Conservative strategies, spread exposure across asset classes, regions and sectors, so that the client’s outcome does not rest on a handful of technology leaders or the result of a single policy decision. Structured Notes allow advisers to link a defined payoff to the performance of an index or basket, with features such as capital protection or enhanced income set at the outset.

That gives clients a known framework through weeks when markets react to several events at once. Because a Structured Note is an obligation of its issuer, advisers should also weigh issuer credit quality, and this week’s bank results are a timely reminder to do so, along with spreading exposure across issuers where appropriate.

What to keep in view

The Budget and the Federal Reserve decision on 28 October are the next scheduled tests, followed by the midterms on 3 November.

Advisers may find it useful to look at how much of each client’s portfolio depends on the largest technology companies, how exposed clients are to sterling and gilt movements, and whether the portfolio is built to absorb a busy run of events rather than to bet on their outcome.

At NEBA Financial Solutions, we work with advisers to turn that review into practical decisions, whether through the breadth of TEAM’s fund range or the defined structure of a Structured Note.

Source: TEAM Asset Management – Market Commentary 19th to 23rd October