Good evening everyone. Last week got ugly in a hurry, and now we walk into one of the busiest earnings weeks of the quarter. Let's get you set up before the bell.

How Last Week Ended

Friday was a rough close. According to Yahoo Finance, the S&P 500 dropped 1.09% to 7,659.44, the Nasdaq fell 2.14% to 26,140.03, and the Dow slipped 0.34% to 52,002.41. For the week, the Nasdaq lost 4.5% and the S&P 500 lost about 2%, the worst week for both since June. The Dow actually finished the week up 0.7%, its second weekly gain in a row.

Chips took the hit. Per the AP report, Micron fell 5.6%, AMD dropped 6%, Broadcom lost 4.5% and Intel gave up 5.8%. CoreWeave sank nearly 12% as worries grew about how much of the AI buildout is being paid for with debt, according to Eurasia Business News. The same report has Brent crude settling at $109.86, which keeps inflation on everyone's mind.

The Fed Is Quiet This Week

Fed officials are in their blackout period ahead of the October 27 to 28 meeting, so nobody is scheduled to speak. On Friday, Chair Kevin Warsh declined to signal what the Fed plans to do, and StoneX reports that the market odds of an October rate hike dropped from around 30% to below 15% after those comments. With no Fed voices in the mix, this week belongs to earnings and a short list of data.

The Calendar

All times ET.

Monday 10/19 Light day. No major US economic data, and Opening Bell notes there are no major tech earnings.

Tuesday 10/20 Housing starts and building permits for September, per BigGo Finance. On the earnings side, GM and RTX report, along with GE Aerospace and Northrop Grumman. Netflix reports after the close, according to Yardeni Research.

Wednesday 10/21 The big one. Meta, Tesla, IBM, Texas Instruments, Lam Research and SAP all report after the close. Meta and Tesla are the first of the Magnificent 7 to report this season.

Thursday 10/22 Weekly jobless claims at 8:30 AM. The forecast is about 200,000 after last week's 199,000, per BabyPips. Procter & Gamble reports before the open, and TokenPost lists Western Digital and MaxLinear after the close.

Friday 10/23 S&P Global flash PMIs for October at 9:45 AM, then the University of Michigan final consumer sentiment reading at 10:00 AM. Last month's PMI readings were 55.9 for manufacturing and 58.8 for services. American Express reports before the open, per StockTitan.

SPY And S&P 500 Levels

SPY closed Friday at $763.25, down 1.1%, according to MarketChameleon. The weekly close landed below the 10-week moving average at $769.04, which is the first real sign of slowing momentum. The bigger uptrend is still intact, with the 40-week average sitting way down at $726.11, per Pure Power Picks.

Levels to watch on SPY:

• Below: $762.04 to $760.64 is the first support zone. If that gives way, the next area people are watching is the low $750s.

• Above: $768.50 to $769.04 is the first resistance zone, which lines up with that 10-week average. After that, $773.25 and then $778.75 to $779.40.

On the S&P 500 itself, StoneX has the index pushing up against falling trendline resistance near 7,750, with the record high area around 7,840. The IG chart work puts the record at 7,844. Below, StoneX flags 7,650 as rising trendline support, 7,620 (the June high) next, and 7,500, the September low, if sellers really take control.

That is a lot of numbers, so here is the short version. Holding Friday's area keeps this a pullback inside an uptrend. Losing it with volume says the AI selloff has more room to run, and Wednesday night's earnings are the most likely trigger for either one.

What This Means For Small Caps

If you trade low caps, last week mattered. The Russell 2000 lost 3% on the week, according to the AP, and it is still up 9.6% for the year. Gotrade, citing Seeking Alpha, reports the index has fallen more than 10% from its August peak and closed below its 200-day average on October 13. The same report quotes StoneX saying small caps have become unusually sensitive to bond yields.

Here's our read on what that means. When the whole group is under pressure, most small caps just trade with the tape and fade. The ones that still move are the ones with a real reason, like fresh news, a filing, or a story that has volume behind it. Low floats can still run in a weak market, but they can also drop twice as fast, and spreads get wider when liquidity dries up.

So this week, we'd rather see a name hold up on a red day than chase one on a green day. Watch the first 30 minutes after the open, pay attention to volume, and have your exit in mind before you ever hit buy. Wednesday night's AI and chip earnings could swing sentiment for small caps too, since a lot of them trade in that same orbit.

Bottom Line

Monday is quiet, Tuesday and Wednesday are loaded with earnings, and Friday's PMIs close out a light data week. SPY is sitting right on top of its first support zone, and the Fed is silent. The next big move likely comes from Meta and Tesla on Wednesday night, so keep your plan simple and your levels marked.

This is general market commentary for informational purposes only. It is not investment advice or a recommendation to buy or sell anything. Data sourced from Yahoo Finance and public earnings calendars. Always verify current levels before making any trading decisions.