The Stallion Pride Daily · 2026-10-02

STALLION PRIDE CAPITAL MANAGEMENT

The Stallion Pride Daily

Week in Review · Friday, 2 October 2026

MARKET NOTES

Term of the day

Tail risk

The chance of outcomes far from normal, such as crashes, that happen more often than a bell curve suggests.

Why it matters in quant investing: Strategies can look safe for years and then give back much of their gains in one tail event.

In one minute

The read

The short version
US stocks fell this week (S&P 500 -0.22%), with the biggest companies doing better than the typical one; long-term interest rates edged up; markets are calm.

US equities declined this week: the S&P 500 -0.22%, the Nasdaq-100 +0.68% and the Russell 2000 -0.16% (ETF price returns).
The cap-weighted index beat the equal-weighted S&P 500 by 0.43 points, so the largest companies carried the typical stock.
Beneath the surface, 26% of stocks in our panel sit above their 50-day average (16th percentile of our own history), and 1 of 11 sectors has beaten the S&P 500 over 20 sessions.
The 10-year Treasury yield stands at 5.24% (-5 bp on the day, +6 bp over five sessions); high-yield spreads are 324 bp, +44 bp over five sessions (as of 1 Oct).
The VIX closed at 15.31 (+2.96% over five sessions), with the volatility curve in contango: three-month implied sits 17.6% above spot.
SPCM's regime model classifies the tape as Bull Trend, convexity rewarded, volatility tier VQ1 Low.

How our system reads the tape

Market dashboard

Trend

Deteriorating

z=-0.25 against 186 stored observations

Breadth

Narrowing

z=-0.94 against 186 stored observations

Volatility

Contracting

z=-0.49 against 186 stored observations

Liquidity

Improving

z=-1.40 against 186 stored observations

Dispersion

Contracting

z=-0.69 against 186 stored observations

Rates

Tightening

10Y +6.0bp over 5 sessions; 2s10s STEEPENING

Credit

Widening

HY OAS +44.0bp over 5 sessions; 74th pctile of its own history

Leadership

Concentrating

1 of 11 sectors beating SPY over 20 sessions (9%)

From SPCM Daily Market Intelligence, run 2026-10-03T12:00:26Z. States are scored against our own stored history, not a forecast. Report confidence: PARTIAL.

What each reading means

Reading

In plain English

Trend
Deteriorating

The market's upward push is fading compared with its recent pace.

Breadth
Narrowing

Fewer stocks are doing the heavy lifting; the index can rise while most stocks do not.

Volatility
Contracting

Markets are calmer; daily swings are smaller.

Liquidity
Improving

Stocks are getting easier and cheaper to trade.

Dispersion
Contracting

Stocks are moving more in lockstep.

Rates
Tightening

Interest rates rose, so borrowing became more expensive.

Credit
Widening

Riskier companies now pay more to borrow; lenders are more cautious.

Leadership
Concentrating

Gains are coming from only a few sectors.

Equities

Markets

Close

1D

5D

MTD

YTD

S&P 500 (SPY)

769.64

+0.74%

-0.22%

+0.92%

+12.86%

Nasdaq-100 (QQQ)

749.58

+1.02%

+0.68%

+1.33%

+22.02%

Russell 2000 (IWM)

281.52

+0.90%

-0.16%

+1.31%

+14.36%

Dow Jones Industrials (DIA)

511.10

+0.49%

-1.23%

+0.50%

+6.35%

S&P 500 equal weight (RSP)

209.73

+0.35%

-0.65%

+0.82%

+9.49%

VIX index

15.31

-6.59%

+2.96%

-6.30%

+2.41%

ETF price returns to the 2 Oct close; dividends excluded.

In plain English

These are the main gauges of the US stock market. The S&P 500 follows 500 large companies, the Nasdaq-100 leans toward technology, the Russell 2000 follows smaller companies, and the equal-weight index gives every S&P company the same say, so it shows how the typical large company did. This week, the biggest companies beat the typical one by 0.43 percentage points. The VIX is the market's “fear gauge”: what investors pay to protect against big swings over the next month. At 15.31 it is lower than 82% of the past year's readings.

Week in review

The week, session by session

Session

S&P 500

Nasdaq-100

Monday, 28 Sep

-0.74%

-1.07%

Tuesday, 29 Sep

-0.18%

+0.19%

Wednesday, 30 Sep

-0.21%

+0.25%

Thursday, 1 Oct

+0.18%

+0.31%

Friday, 2 Oct

+0.74%

+1.02%

Macro

Rates, credit and volatility

Level

1D

5D

20D

2Y Treasury

4.78%

-10 bp

-9 bp

+39 bp

10Y Treasury

5.24%

-5 bp

+6 bp

+45 bp

30Y Treasury

5.61%

-3 bp

+14 bp

+34 bp

2s10s curve

46 bp

+5 bp

+15 bp

+6 bp

10Y real yield (TIPS)

2.88%

+3 bp

10Y breakeven inflation

2.36%

+2 bp

HY OAS *

324 bp

+12 bp

+44 bp

+59 bp

IG OAS *

86 bp

+2 bp

+7 bp

+5 bp

VIX term: 9D / spot / 3M / 6M

12.06 / 15.31 / 18.01 / 20.15

CONTANGO

Treasury yields: FRED constant-maturity series as of 2026-10-02. * Credit spreads as of 2026-10-01; the source refresh failed and the last good value is shown, not an estimate.

In plain English

A Treasury yield is the interest rate the US government pays to borrow; it sets the baseline cost of money for everyone else. A “bp” (basis point) is one hundredth of a percentage point. The 10-year yield moved +6 bp over five sessions, which is +0.06 percentage points. The “2s10s curve” is the gap between 10-year and 2-year rates, now 46 bp; when it steepens, long-term rates are rising faster than short-term ones. The high-yield (HY) spread is the extra interest riskier companies pay over the government: 324 bp, up 44 bp in five sessions. “Contango” in the volatility curve means protection for later months costs more than protection for next month, which is the normal, calm state.

What it means for you

Rising rates and widening spreads are caution lights, not alarms. We track them because lending markets often move before stock markets do.

Where the tape is working

Leadership

Sector

1D

5D

5D vs S&P

Technology (XLK)

Leader

+1.01%

+1.80%

+2.03%

Energy (XLE)

Leader

+0.19%

+1.26%

+1.48%

Utilities (XLU)

Leader

+0.38%

+0.81%

+1.03%

Communication Svcs (XLC)

Laggard

+0.35%

-2.34%

-2.12%

Financials (XLF)

Laggard

+0.06%

-2.46%

-2.24%

Health Care (XLV)

Laggard

-0.01%

-2.65%

-2.43%

Select Sector SPDR ETFs, price returns. Relative = sector minus SPY.

In plain English

A sector is a group of companies in the same line of business, such as technology or energy. “5D vs S&P” shows whether a sector did better or worse than the whole market over the last five sessions. Over that stretch technology led and health care lagged.

Beyond equities

Cross-asset

Close

1D

5D

MTD

Gold (GLD)

380.14

-0.68%

-3.37%

-0.18%

WTI crude (USO)

147.37

-1.77%

-0.65%

+1.17%

US dollar (UUP)

28.89

-0.24%

+0.94%

+0.42%

Bitcoin (BTCUSD)

84,504.88

-0.41%

+0.07%

+1.14%

Commodity and dollar figures are ETF proxies (GLD, USO, UUP).

In plain English

Beyond stocks: gold is often bought for safety, crude oil reflects energy supply and demand, the dollar line shows the currency's strength against others, and bitcoin is the largest cryptocurrency.

Behind the scenes

Wall Street Insider

Fresh money at the turn of the monthWhy now

Retirement contributions, pension payments and fund inflows tend to cluster around the start of each month. Researchers have long documented a "turn-of-the-month" pattern, though like any calendar effect it is far from guaranteed.

A new month began this week.

A gamma squeeze, in plain terms

When investors pile into call options, the dealers who sold them buy stock to hedge, and they must buy more as the price rises. That feedback loop can drive sharp, short-lived rallies that have little to do with the company's fundamentals.

Explainers on how markets work, not news or tips.

The quiz

Which of these best describes Drawdown?

A. The fall from a previous peak to a later low

B. The best and worst unrealized point during a trade

C. Deciding how much capital to put into each position

D. Total long plus short, versus long minus short

Answer below.

Answer: A. Drawdown: How far an investment has fallen from its highest point. Maximum drawdown is the largest such fall over a period.

Talk to us

Questions about today's read, or want to talk markets and systematic investing with the team? Write to us or call.

Email us

Call +1 (917) 833-4308

corporate@stallionpridecm.com · +1 (917) 833-4308

Market Notes from Stallion Pride Capital Management, LLC, for general information and education. Market figures are ETF price returns with dividends excluded, as published in our data warehouse, and may contain errors. Nothing here is investment advice, a recommendation, or an offer to sell or a solicitation of an offer to buy any security.

Stallion Pride Capital Management, LLC · corporate@stallionpridecm.com