Next week could be dangerous for the market as earnings slow to a trickle and investors continue to ignore government data. Already last week there was further uncertainty in the market. On Friday, technology pushed all three major indexes into the red, pushing stocks up for the first time in three weeks. In particular, the Nasdaq Composite Index fell more than 3%, posting ugly losses. Nvidia is down more than 7% this week. Metaplatforms and Microsoft each fell about 4%. Barring a major trigger on the calendar, this volatility could continue into next week. While the year-end bull market rings true for many investors, even the most optimistic traders are concerned that more volatility, and maybe even a correction, is on the horizon. “There are some edgy people here,” said Mark Marek, chief investment officer at Siebert Financial. “And we’re in this data blackout right now, and there may not be enough wind to keep the ship moving forward during quiet times like this.” Eventful Movement Part of that tension is the result of this week’s eventful market movements. Many investors are concerned about declines in artificial intelligence stocks such as Palantir, which were punished despite impressive returns, indicating buyer fatigue after this year’s bull market. The S&P 500 is up more than 30% from its April lows, but retail traders have used every drop as an opportunity to move higher, and they have rarely strayed far from the bull market. Wall Street is calling for caution. Concerns about breadth have been raised, as a comparison of the market capitalization-weighted index S&P 500 (SPY) to the Equal Weighted Index (RSP) shows the narrowest width going back to 2003. With Magnificent Seven stocks accounting for more than a third of the S&P 500, many argue it’s time to be on guard for a pullback. “Investors should be cautious about chasing the extended upside of this concentrated bull market,” Craig Johnson, chief market technician at Piper Sandler, said this week. “Reduce exposure to unprofitable sectors or sectors that fall below key support levels. Be wary of large-cap tech stocks as we expect a period of consolidation.” Still, if investors can weather a near-term consolidation phase, there could be further upside potential by the end of the year. November is historically the best month for stocks. Building data infrastructure related to investments in artificial intelligence, strong corporate earnings, accommodative monetary policy, and the One Big Beautiful Bill stimulus all point to a constructive outlook for the end of the year. The pace of news is slow, but there are several items on the calendar for next week. Third-quarter earnings season is almost over, and notable companies such as Walt Disney Co., Cisco Systems Inc., and Applied Materials Inc. are expected to release their latest financial information within the next week. Nvidia’s next big report to watch for investors isn’t scheduled until later this month. “We’ve been seeing this hangover lately, where you’re having a really good time during the earning season, and then it takes a few weeks for everyone to reset their clocks and start climbing again,” said Mark Hackett, chief market strategist at Nationwide. “That’s kind of what we expect.” Week Ahead Calendar All Time (ET). Monday, November 10th Results: Paramount Skydance, Occidental Petroleum, Tyson Foods, Interpublic Group of Companies Tuesday, November 11th, 6 a.m. NFIB Small Business Index (October) Wednesday, November 12th Results: Cisco Systems, Transdime Group Thursday, November 13th Results: Applied Materials, Walt Disney Company Friday, November 14th
