10/13/2026 ValuEngine Weekly Commentary with Strategy Notes

U.S. equity markets were mixed this week, with broader gains across value, defensive, and cyclical sectors offset by weakness in technology and the NASDAQ 100. The S&P 500 ETF (SPYM) gained 0.99%, while the NASDAQ 100 ETF (QQQM) declined 0.52%, pressured by a 1.86% pullback in Technology (XLK). Energy (XLE) led the ETF group with a strong 5.05% gain, followed by Consumer Staples (XLP), Utilities (XLU), Health Care (XLV), Financials (XLF), Real Estate (XLRE), Consumer Discretionary (XLY), Value (VTV), Materials (XLB), and Communication Services (XLC). Growth (VUG) posted a modest gain, while Small Caps (VB) and Industrials (XLI) were slightly lower. Stock-specific momentum remained strong in selected technology, semiconductor, health care, and biotechnology names, led by Everpure (P), Moderna (MRNA), Credo Technology (CRDO), Illumina (ILMN), ASE Technology (ASX), and SABESP (SBS).

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In the below tables we use major ETF’s as a proxy for some major indexes as well as each of the sector groups into which we divide the overall markets. Tracking these over time provides a more defined picture of the US markets than simply tracking major indexes. This is followed by notable individual stock movers over the past month.

ETF Performance:

Ticker	Name	VE Rating	Last Week’s Close Price	Weekly Change
QQQM	Invesco NASDAQ 100 ETF	5	308.69	-0.52%
SCHD	Schwab US Dividend Equity ETF	2	32.72	1.47%
SPYM	State Street SPDR Portfolio S&P 500 ETF	4	90.6	0.99%
VB	Vanguard Morningstar Small-Cap ETF	3	288.99	-0.13%
XLB	State Street Materials Select Sector SPDR ETF	1	48.86	1.49%
XLC	State Street Com Svc Sel Sec SPDR ETF	2	110.32	1.10%
XLE	State Street Energy Select Sector SPDR ETF	4	62.82	5.05%
XLF	State Street Financial Sel Sec SPDR ETF	2	53.49	2.92%
XLI	State Street Industrial Select Sector SPDR ETF	2	169.95	-0.36%
XLK	State Street Technology Select Sector SPDR ETF	5	199.81	-1.86%
XLP	State Street Consumer Staples Sel Sect SPDR ETF	1	80.53	4.48%
XLRE	State Street Real Estate Select Sector SPDR ETF	1	40.81	2.47%
XLU	State Street Utilities Select Sector SPDR ETF	1	39.83	4.34%
XLV	State Street Health Care Select Sector SPDR ETF	2	166.18	3.23%
XLY	State Street Consumer Disc Sel Sect SPDR ETF	1	110.04	2.05%
VTV	Vanguard Morningstar Value ETF	3	217.23	1.86%
VUG	Vanguard Morningstar Growth ETF	5	91.17	0.43%

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Last Week Top 3 Stock Performers (Global):

Ticker	Name	VE Rating	Last Close Price	Price 30 Days Ago	Monthly Difference
CRDO	Credo Technology Group Holding Ltd	5	202.05	150.09	34.62%
SBS	Compnh d Smt Bc d sd d S Pl – SBSP	5	6.73	5.22	28.93%
ASX	ASE Technology Holding Co Ltd	5	47.21	37.08	27.32%

Last Week Top 3 Stock Performers (US):

Ticker	Name	VE Rating	Last Close Price	Price 30 Days Ago	Monthly Difference
P	Everpure Inc	5	153.63	93.78	63.82%
MRNA	Moderna Inc	5	214.83	146.69	46.45%
ILMN	Illumina Inc	4	273.96	208.21	31.58%

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Strategy Note : 

The first full week of the fourth quarter continued the broad market’s tug of war games between growth and value. After Micron Technology (MU) reported higher than expected earnings at the end of September, the first two days of October were marked by large-cap tech stock dominance in accordance with the overall 3rd Quarter of 2026 and as discussed last week.

We look at the strategy for the remainder of 2026 in context with the following ETFs.

• SPYM (State Street SPDR Portfolio S&P 500 ETF): Offers ultra-low-cost, passive exposure to the 500 largest publicly traded U.S. companies spanning all major economic sectors.
• QQQM (Invesco NASDAQ 100 ETF): Tracks the 100 largest non-financial companies listed on the Nasdaq, offering a cost-efficient vehicle heavily tilted toward technology and growth stocks.
• BUFR (FT Vest Laddered Buffer ETF): Utilizes a laddered portfolio of options-based funds to provide U.S. large-cap equity exposure with built-in downside buffers and capped upside potential.
• MDY (SPDR S&P MidCap 400 ETF): Tracks the S&P MidCap 400 Index to give investors exposure to mid-sized U.S. corporations positioned between large-caps and small-caps.
• IWM (iShares Russell 2000 ETF): Captures the performance of 2,000 small-cap U.S. companies, making it a primary benchmark for small-business equity exposure.
• VUG (Vanguard Growth ETF): Focuses heavily on large-cap U.S. corporations that exhibit strong growth traits, leading to significant allocations in the technology and consumer services sectors.
• VTV (Vanguard Value ETF): Targets undervalued large-cap U.S. companies, prioritizing stocks with lower price-to-earnings ratios and higher relative dividend yields.
• SCHD (Schwab U.S. Dividend Equity ETF): Focuses on fundamentally strong, high-yielding U.S. companies backed by a required 10-year track record of consistent dividend payouts.
• VEU (Vanguard FTSE All-World ex-US ETF): Offers broad market capitalization exposure to developed and emerging international equity markets outside of the United States.
• EEM (iShares MSCI Emerging Markets ETF): Focuses exclusively on large- and mid-cap equities from developing global economies, such as China, India, and Taiwan.
• GLDM (SPDR Gold MiniShares Trust): Provides investors with low-cost, direct price exposure to physical gold bullion securely stored in secure vaults.
• IBIT (iShares Bitcoin Trust): Enables traditional brokerage accounts to gain direct investment exposure to the spot price of Bitcoin without navigating cryptocurrency exchanges.
• TLT (iShares 20+ Year Treasury Bond ETF): Tracks long-term U.S. Treasury bonds with remaining maturities of 20 years or more, making it highly sensitive to changes in domestic interest rates.

ETF Performance and Valuation Data (as of October 9, 2026)

Ticker	ETF Name	VE Rating	YTD Chg	2nd-Half-to-Date	MTD Chg	Div Yield	Expense Ratio
SPYM	SPDR S&P 500 Market	4	15.2%	4.1%	-0.4%	1.3%	0.09%
QQQM	Invesco NASDAQ 100	5	16.8%	4.8%	-0.6%	0.7%	0.15%
BUFR	FT Vest Buffer	NR	8.4%	2.1%	0.1%	0.0%	1.05%
MDY	SPDR S&P MidCap 400	3	10.1%	3.2%	-0.2%	1.2%	0.05%
IWM	iShares Russell 2000	4	7.3%	3.8%	0.5%	1.4%	0.19%
VUG	Vanguard Growth	5	19.4%	5.2%	-0.7%	0.5%	0.04%
VTV	Vanguard Value	3	11.2%	3.1%	-0.1%	2.4%	0.04%
SCHD	Schwab US Dividend Equity	2	20.0%	4.0%	0.2%	3.2%	0.06%
VEU	Vanguard FTSE All-World ex-US	NR	8.2%	2.8%	-0.8%	2.9%	0.07%
EEM	iShares MSCI Emerging Markets	NR	9.5%	4.2%	-1.2%	2.6%	0.70%
GLDM	SPDR Gold MiniShares	NR	-2.8%	3.7%	1.1%	0.0%	0.10%
IBIT	iShares Bitcoin Trust	NR	42.5%	12.4%	3.4%	0.0%	0.25%
TLT	iShares 20+ Yr Treasury Bond	NR	-3.1%	1.5%	-0.9%	3.9%	0.15%

A number of insights are apparent from the table above.  The one that stands out the most to us is that the combination of value, income and quality variables that the Schwab index formula use for SCHD has outperformed everything year-to-date.  It has the highest dividend yield of any of the benchmark ETFs we follow.  There are many equity ETFs with higher dividend yields such as DIV from Global X but with significant capital appreciation under-performance.  The fact that SCHD  outperformed VUG in a year in which QQQM has outperformed SPYM so far is quite remarkable.  In the second half, growth as measured by VUG has been the top performer.  After outperforming US stocks in 2025, non-US stocks have not fared well against their US counterparts in 2026.  Looking at alternatives, Bitcoin’s proxy, IBIT, more than doubled the YTD performance of all our ETFs while GLDM (gold) has performed worse than even the beleaguered long-term US bond TLT when yield is factored into consideration.

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The ValuEngine predictive model clearly is stuck on growth stocks and specifically big cap tech growth stocks.

Here is a similar chart for the Select Sector SPDRs, composed entirely of the stocks of S&P 500 companies in that industry sector.

Ticker	Sector / Fund Name	VE Rating	YTD Chg	2nd-Half-to-Date	MTD Chg	Forward P/E	Div Yield
XLB	Materials Select Sector	1	9.04%	-3.02%	1.01%	17.8	1.95%
XLC	Communication Services Select	2	-6.02%	3.01%	-1.02%	18.4	1.15%
XLE	Energy Select Sector	3	46.03%	23.04%	6.02%	12.1	3.41%
XLF	Financials Select Sector	2	0.02%	2.01%	2.03%	15.1	1.84%
XLI	Industrials Select Sector	3	9.03%	-0.92%	1.03%	19.5	1.62%
XLK	Technology Select Sector	5	38.01%	4.02%	2.01%	28.5	0.65%
XLP	Consumer Staples Select Sector	1	7.03%	0.01%	4.02%	20.2	2.70%
XLRE	Real Estate Select Sector	1	3.02%	-5.01%	2.02%	32.4	3.12%
XLU	Utilities Select Sector	1	-3.01%	-9.03%	5.01%	16.2	3.35%
XLV	Health Care Select Sector	2	10.02%	8.03%	1.02%	17.9	1.58%
XLY	Consumer Discretionary Select	1	-5.01%	-4.02%	4.01%	23.1	0.88%
SPY	SPDR S&P 500 ETF Trust	4	14.02%	4.03%	2.01%	21.5	1.32%
QQQ	Invesco QQQ Trust (Nasdaq 100)	5	22.04%	2.02%	2.02%	26.4	0.68%
BUFR	FT Vest Buffer ETF	NR	11.02%	4.01%	1.02%	18.2	0.00%
VTV	Vanguard Value ETF	3	15.03%	1.02%	2.03%	15.4	2.35%

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However, between October 5th and October 9th, the broader market experienced mild consolidation following mixed macroeconomic news while the Energy sector – as measured by StateStreet Select Sector SPDR Energy (XLE) – dramatically outperformed all other sectors. The defensive sector Consumer Staples – as measured by StateStreet Select Sector SPDR Staples (XLP) – also experienced a healthy rebound. Regarding XLP, many strategists have predicted for more than a year that this sector ETF filled with high quality and low-debt stocks would rebound strongly. On the contrary, during all that time until the 4th quarter, the reverse has been true. These stocks were used as sources of funds for AI-related stocks as earnings for big-cap tech continued to exceed expectations. On a 5-year basis, XLP has been the worst performing of the 11 GICS (Global Industry Classification Standard) industry sectors even though most analysts consider stocks in this industry to be undervalued. The table below illustrates that on a forward P/E basis, it is the fourth most overvalued sector.

Somewhat surprisingly, our rating on the Energy Select Sector SPDR XLE actually fell from 4 (Buy) to 3 (Hold / Neutral) despite the great week. Or possibly, it is because of the rise. An elevated stock price could negatively impact XLE’s price growth potential. That said, the utter dominance recently by the energy and tech sectors is worth noting.