Stock Market Overview: A Mixed Week for Investors

Oil prices rose and concerns about debt financing for artificial intelligence infrastructure pressured several major stock indexes during the week ending October 23. The Dow gained modestly, while the S&P 500 and Nasdaq declined. Smaller companies performed better, with the Russell 2000 gaining 1.89%.

The contrast is a useful reminder: the stock market is not one single investment. Different areas of the market can behave quite differently, even in the same week.

Market Index Performance: Last Week and Year-to-Date

Bond Market Update: Treasury Yields Move Lower

The 10-year U.S. Treasury yield declined to 4.99% from 5.09% the prior week, after reaching approximately 5.31% earlier in October. Bond prices generally move opposite to yields, so the decline supported high-quality bonds, which have now gained for three consecutive weeks.

For retirees, bonds can help provide income and potentially temper portfolio volatility, while also serving as a source of funds for planned withdrawals.

Oil Prices and Geopolitical Tensions

West Texas Intermediate crude oil finished the week at $103.44 per barrel, up from $101.41 the prior week. Reports of attacks involving Iran-backed Houthi militants and energy facilities in Saudi Arabia added to concerns about supply disruptions.

Higher energy costs can increase transportation and production expenses, pressure corporate profits and complicate efforts to bring inflation under control. For retirees, persistent inflation can erode purchasing power over time.

Artificial Intelligence: The Growing Cost of Expansion

Artificial intelligence continues to attract significant investment, but the financing behind that expansion is receiving greater scrutiny. LPL Financial estimates that approximately $400 billion to $500 billion in debt has been issued thus far in 2026 for data centers and other AI-related spending.

Borrowing is not necessarily a problem. The questions are whether companies can earn an adequate return on these investments and comfortably service their debt. AI may offer substantial long-term benefits, but high expectations also create the potential for disappointment.

Why Diversification Matters for Retirement Investors

Last week illustrated the benefits of diversification. While the S&P 500 and Nasdaq declined, small-cap stocks gained nearly 2%, certain value-oriented investments advanced, and high-quality bonds posted positive returns. Not everything moved in the same direction.

A diversified portfolio can combine large and small companies, growth and value investments, international stocks and bonds. Each responds differently to changing economic conditions, interest rates and investor expectations. This may help reduce reliance on any single sector or investment theme.

For those drawing income from their portfolios, diversification can be especially valuable. A balanced investment approach, paired with a thoughtful withdrawal strategy, may help limit the need to sell depressed stocks to meet living expenses during difficult markets.

Diversification does not eliminate risk or guarantee gains. Its purpose is to help manage risk while keeping the portfolio aligned with your income needs, time horizon and comfort with market fluctuations. Successful retirement investing is not simply about chasing the highest return; it is about supporting the retirement you desire.

Looking Ahead: Fed Decision, Inflation and Earnings

Wednesday: The Federal Reserve announces its interest rate decision. Investors will pay close attention to its outlook for inflation and economic growth.

Thursday: The Personal Consumption Expenditures (PCE) inflation report will offer another look at price pressures, especially as energy costs rise.

Corporate earnings: Approximately 179 S&P 500 companies are scheduled to report, including Alphabet (Google), Microsoft, Amazon, Ford, UPS, Visa, GE Vernova, Merck, Intel, Exxon Mobil and Caterpillar. Their results and forecasts should offer insight into profits, consumer demand and business investment. It is also the final full week before the midterm elections, adding another potential source of short-term uncertainty.

Final Thoughts: Keep the Big Picture in Perspective

With higher oil prices, AI borrowing concerns, important economic releases and elections approaching, investors certainly have plenty to consider. Should prove to be an interesting week!

Last week reminded us that market leadership can change quickly. Rather than trying to predict the next winning investment, we believe a diversified portfolio built around your retirement income needs and long-term objectives remains a prudent approach.

At Retirement Refined, our focus is not simply on how markets perform from one week to the next, but on helping clients maintain the financial confidence and income strategy necessary to enjoy retirement. Have a great week!

As always, thank you for taking a few minutes each week to read our Retirement Report. I sincerely appreciate your continued confidence and the opportunity to be part of your retirement journey. Until next week, stay informed and enjoy the journey to and during retirement.

Paul Levin, CFP®, ChFC®, RICP®¹, TPCP®
Founder and Principal

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Retirement Refined, LLC

Securities and advisory services offered through LPL Financial, Member FINRA/SIPC and a Registered Investment Advisor.

The opinions voiced in this material are for general information only and are not intended to provide specific advice or recommendations for any individual. All performance referenced is historical and is no guarantee of future results. All indices are unmanaged and may not be invested into directly.

All market data sourced from The Wall Street Journal, October 23, 2026.

1. RICP® conferred by The American College. ↩︎