Walmart shares have gained 16.2% in October, putting Walmart on course for the strongest monthly performance since 1999. The Consumer Staples Select Sector SPDR Fund (XLP) has risen 11.3% in October, approaching its best month since launching in December 1998. The SPDR S&P 500 ETF Trust (SPY) is roughly unchanged this month. The Technology Select Sector SPDR Fund (XLK) has declined 6.9% in October. The iShares Semiconductor ETF (SOXX), which tracks chipmakers, has fallen more than 15% this month. Consumer staples are outperforming the S&P 500 by about 11 percentage points this month, a gap matched only in April 2022 during XLP's 27-year history.
Meta Platforms shares fell about 8% on Thursday because of concerns about Meta's artificial intelligence spending. XLK consequently declined 3.4% on Thursday. XLP advanced 2.7% on Thursday. The 10-year Treasury yield dropped about 17 basis points to 4.95%, the largest daily decline since August 2, 2024.
Bank of America clients sold a record $14.8 billion in individual U.S. stocks during the week through October 16. Bank of America equity quant strategist Jill Carey Hall said in a Global Research report that clients sold stocks across 8 of 11 sectors, with technology recording the second-largest outflows ever. Consumer staples were among the few sectors that clients purchased.
Bank of America's equity derivatives team, which includes strategist Abhinandan Deb, does not regard the selloff as the beginning of a technology crash. The strategists said in a report this week that positioning largely explains the disruption at the edges of the AI trade, rather than fundamental weakness at its center. The strategists said U.S. equities continue to undergo sharp rotations during stress rather than market breakdowns, with defensive stocks' recent outperformance against technology historically extreme. However, the analysts said healthcare and consumer staples now rank among the market areas with the highest readings on the bank's Bubble Risk Indicator.
Procter & Gamble shares rose 5.9% on Thursday following fiscal first-quarter results. Procter & Gamble has gained 14.6% in October, approaching its strongest month since October 1998, when the shares rose 24.7%. Procter & Gamble's core earnings increased 1% to $2.00 per share in the fiscal first quarter. Net sales rose 4% to $23.28 billion. Volumes increased 2.4%. Procter & Gamble maintained its fiscal 2027 core earnings forecast. Procter & Gamble expects about $1.4 billion in after-tax pressure from commodity costs this fiscal year. Procter & Gamble's chief financial officer said oil prices will make those pressures materially greater during the second quarter and second half.
Five of seven earlier comparable months occurred in 2000 and 2001, when investors abandoned dot-com winners before the recession that began in March 2001. The S&P 500 stood lower one year afterward in five of those seven cases. The S&P 500 declined between 1.6% and 9.5% in every earlier case. However, SPY is flat this October and remains about 2.5% below the record intraday high reached this month. Money is therefore shifting between sectors within a market close to its peak. The closest comparison occurred in February 2026, when XLP rose 7.8% while SPY declined 0.9%. SPY was up 11.8% six months later.
Polymarket traders assign a 7.5% probability to a U.S. recession by the end of 2026. Polymarket traders assign a 35% probability to a U.S. recession by the end of 2027. The record monthly performance reflects investors' strong demand for protection from the AI trade. A bear market and recession followed the last similarly strong demand for such protection in 2000 and 2001.
Walmart Stock Heads for Best Month Since 1999
BenzingaShare
Summary
Walmart shares rose 16.2% in October, on track for the best monthly gain since 1999. The XLP ETF gained 11.3%, outperforming the S&P 500 by 11 percentage points. ETF inflows into consumer staples contrasted with ETF outflows in tech. The XLK fell 6.9%, while SOXX dropped over 15%. Bank of America clients sold $14.8 billion in U.S. stocks through October 16, with tech among the top outflows. P&G shares climbed 5.9% after strong Q1 results.
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