Breadth Is Positive? How Is That Even Possible?

Avatar photo Bob Lang on October 22, 2026

Even in this carnage of selling there are some green shoots if you’re looking at places other than tech. Homebuilders are strong but so are Staples following some strong earnings out of Procter & Gamble ($PG). Perhaps a rotation to more safe and sound names but without the strong growth prospects is now in order.

Volatility is on the rise, but the biggest hits are in the Nasdaq, down nearly 2.6% at this point. Software names are well-bid and showing some strength; the Industrials actually went green for a moment.

Rotation is something we have seen quite often recently as money leaks from the former leaders into new groups. That is usually pretty healthy but certainly makes it feel worse if you’re in the most loved names that are being distributed.

Things I Did Today

Avatar photo Doug Kass on October 22, 2026

Here are today’s things:

* I covered all of my $SPY short at $764.96.

* I covered most of my $TSLA at $369.55.

* I added to $GLAS at $2.21, $GTBIF at $6.53 and $MSOS at $4.09.

* I sold more of my $PG long at $165.70.

Position: Long MSOS common (VL) and calls (VS), PG (VS), GLAS (S), GTBIF (S); Short TSLA (VS)

More Rotation

Avatar photo NeilSethi on October 22, 2026

While AI-related sectors are down sharply, four sectors are up more than 1%.

Schwab

At the top of that list is Staples. The S&P 500 Staples Sector ETF ($XLP) is up 2.5%, its best day since July and before that April 2025 approaching its February all-time high.

Risk Happens Fast in the Market’s Sea

Avatar photo Doug Kass on October 22, 2026

“The sea was angry that day, my friends – like an old man trying to send back soup in a deli.”

– George Costanza

Today’s market is different than some of the past sharp drawdowns in the last 12-18 months.

* The drop is broad and deep — with other asset classes like gold and bitcoin joining the downside.

* There is no single catalyst like Leopold (Situational Awareness hedge fund liquidation) to blame on the market’s selloff.

* The weakness in financials over the last several months is now accelerating, with no respite whatsever.

* The decline in over stretched stocks is breathtaking — especially the over conceptualized AI stocks on the periphery (e.g. $GEV -$105 to $820). Look at the breakdown in $CAT’s chart (-$45 and down from $950 to $695 in a straight line).

* We are witnessing a classical (but violent) rotation. See the remarkable strength in staples and healthcare.

* A sign of flight to quality/safety seen in a pronounced rise in bond prices (and in lower bond yields). ($TLT +$1.20 today)

Position: None

Charting the Late Morning Market

Avatar photo Doug Kass on October 22, 2026

– NYSE volume 3% above its one-month average; 

– Nasdaq volume flat to its one-month average; 

– VIX index: up 15.59% to 19.28

Breadth

SOURCE: Interactive Brokers

S&P500 Sector ETFs

SOURCE: Interactive Brokers

% GAINERS, DECLINERS

SOURCE: TheStreet Pro

Nasdaq 100 and S&P500 Heat Maps

SOURCE TheFly