{"id":34814,"date":"2026-10-17T00:55:26","date_gmt":"2026-10-17T00:55:26","guid":{"rendered":"https:\/\/alchemymarkets.com\/?post_type=market_insights&p=34814"},"modified":"2026-10-17T00:55:28","modified_gmt":"2026-10-17T00:55:28","slug":"markets-are-complacent-is-wall-street-ignoring-the-warning-signs","status":"publish","type":"market_insights","link":"https:\/\/alchemymarkets.com\/sv\/education\/market-insights\/opening-bell\/markets-are-complacent-is-wall-street-ignoring-the-warning-signs\/","title":{"rendered":"Markets are Complacent: Is Wall Street Ignoring the Warning Signs?"},"content":{"rendered":"\n

Earlier on Friday, around 12PM Singapore time, I was looking at the Dow Jones and noticed it was doing considerably better than the S&P 500 and Nasdaq. With DJI sitting at +1.9%, SP500 \u22121.8%, and NDX at \u22122% on a two-week timeframe.<\/p>\n\n\n\n

Now that another day has passed, that number has changed considerably: DJI at +0.67%, SPX at \u22121.95%, and NDX at \u22125.49%.<\/p>\n\n\n\n

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It’s clear that the tech market is dragging down the markets, with semiconductors taking the brunt of the damage. TSM has been moving lower despite strong earnings, Micron ain’t doing so hot, and Nvidia is just rejecting off the highs.<\/p>\n\n\n\n

The Chips Are Not Holding Up<\/strong><\/h2>\n\n\n\n

This is the Semiconductors index versus the Nasdaq, and it\u2019s clear to me that SMH is the foot in the swamp dragging the markets down.<\/p>\n\n\n\n

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And even though TSM posted great earnings, the world\u2019s chip factory is still taking a nose dive this week. Its third-quarter net profit rose 68.7% from a year ago. Good business, ugly price action.<\/p>\n\n\n\n

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This weakness could also be explained by what is happening to other major names in the chip trade. Micron and Nvidia are hardly giving investors much comfort.<\/p>\n\n\n\n

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SMH relative to NDX is one of the cleaner calls. The weekly ratio has pushed into its 20-week EMA<\/a> bollinger band<\/a>. If it loses that structure and fails to reclaim it, I would take that as a warning that semiconductor leadership is weakening beyond just a few bad sessions.<\/p>\n\n\n\n

Nvidia is also worth watching near the marked 229.85\u2013236.54 resistance zone. Its weekly candle has pulled back from that area towards the EMA band. Another failed rebound there would not be a pretty sight.<\/p>\n\n\n\n

So Where Are Investors Hiding?<\/strong><\/h2>\n\n\n\n

So ironically, it’s the stocks that are less directly tied to the AI hardware trade that are holding up better.<\/p>\n\n\n\n

Apple, for example, is holding its uptrend well. It has AI exposure, of course, but it also has a massive installed base, its services business and consumer-device sales. Investors are not valuing the whole company on how many AI data centres get built next year.<\/p>\n\n\n\n

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Netflix is another interesting watch. Its shares are attempting to stabilise after a long decline, and the latest weekly candle is roughly flat compared with some of the damage elsewhere in growth stocks. Its next earnings come on Tuesday, 20 October. It’d be interesting to watch what happens there.<\/p>\n\n\n\n

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For me, that looks more like rotation away from the AI hardware trade than a market-wide vote of confidence. The Dow is holding up. The stocks that carried the biggest expectations are not.<\/p>\n\n\n\n

And with those expectations already coming under pressure, the last thing the market needs is another inflation problem.<\/p>\n\n\n\n

Oil Is Back at the Centre of the Problem<\/strong><\/h2>\n\n\n\n

Much of this can be attributed to rising oil prices towards $110, despite the markets’ reluctance to price in further inflation risks earlier on Thursday with rising September CPI. Gasoline rose 9.1% in the month.<\/p>\n\n\n\n

September\u2019s headline CPI climbed 0.6% month-on-month and 3.7% year-on-year. Core CPI rose 0.3% on the month. Gasoline alone accounted for more than half of the monthly headline increase.<\/p>\n\n\n\n

And this leaves the Fed in a rather awkward spot. Higher fuel prices squeeze households and corporate margins, while high borrowing costs make the AI build-out more expensive. Yet investors initially seemed almost happy to shrug off the inflation print.<\/p>\n\n\n\n

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BREAKING: Brent crude oil surges to nearly $110, its highest level since September 15, as Iran places its armed forces on the highest alert for 72 hours and mobile bomb shelters being rapidly deployed in Tel Aviv.

US oil is now at $100. pic.twitter.com\/P3jRjd1bb7<\/a><\/p>— The Hormuz Letter (@HormuzLetter) October 16, 2026<\/a><\/blockquote>